Employers: higher wages increases unemployment, won’t help economy

De Nederlandsche Bank's call for employers to give employees bigger wage increases is "nonsense", Cees Oudshoorn of employer's organization VNO-NCW said to Financieele Dagblad. According to him, higher wages will only increase unemployment. On Thursday DNB published a study showing that wage increases for employees and freelancers are lower than necessary, compared to the rising corporate profits. The too-low wage increases puts pressure on employees' purchasing power and thereby dampens economic growth. This study led to unions immediately calling for higher wages. But according to VNO-NCW, that is just nonsense. "There is completely no question of underpayment", Oudshoorn said to the newspaper. Real wages did not increase less than it should. "If you want to judge that you should look into labor productivity. They run synchronized with each other." The employers association acknowledges that employees' purchasing power is under pressure, but attributes that to big differences between labor costs to the employer and employee's net income. "Tax cuts are the only route, but that is on politicians' plates." Minister Lodewijk Asscher of Social Affairs and Employment first wants to thoroughly investigate the DNB study before giving a response, a spokesperson said to the newspaper.