In a press release issued yesterday, the Irish Hotels Federation (IHF) have called on the Government to reject the almost 6% increase in the national minimum wage proposed by the Low Pay Commission.

Mr Fenn, Chief Executive of the IHF, believes that such an unsustainable increase in the minimum wage would be seriously damaging to Ireland’s economic recovery in terms of future job creation and international cost competitiveness.
 
He has indicated that hotels are very labour intensive business activities with payroll costs accounting for approximately 40% of turnover, up from 28% over the past 20 years. 

He further claimed that many hotels, particularly in rural areas, operate on payroll costs well in excess of 40% of turnover. Fenn believes that with the economy still fragile, an increase would jeopardise the hard-won competitiveness gains achieved and risk excluding young people from employment and opportunities for advancement.
 
According to Fenn, "The Commission’s proposal would place Ireland at the top of the minimum wage table in Europe, second only to Luxembourg.

This makes no economic sense at a time when we’re coming out of the worst recession in the history of the State and our economic recovery is still fragile. The proposal is incompatible with the current economic situation and would act as an unjustifiable barrier to competitiveness and employment growth." 

Source: www.businessworld.ie