By Juma Kwayera
Kenya is increasingly becoming a high-wage economy, a trend that threatens to stifle foreign investments, unless the Government tackles the spiralling cost of living.
However, the institutions that are expected to force the Government to act – trade unions – are either conniving with the employers to pinch workers or are simply incapable of progressive ideas to alleviate the suffering of workers.
One way of doing it, economists say, is for trade unions to shift strategy and focus more on reining in the cost of living and runaway graft in public sector, which they say is the trigger of astronomical rise in inflation.
In the recent past, trade unions have been taking turns to demand higher salaries from employers, but questions are equally being raised about the unions’ complicity in harmful economic policies and programmes that have precipitated current plight of their members.
With more than 300,000 workers in public institutions having downed or are planning to down tools in protest over low pay and spiralling cost of living, economist Oduor Ong’wen warns the risk of the economy being swamped in excess liquidity is high. Ong’wen warns that the current budget is already constrained to allow the Government to meet the demands of striking teachers, university lecturers, and doctors.
“Strikes have a contagious effect. Any industrial unrest in public institutions spills over the private sector. Persistent focus on salaries is the downside of trade unionism in Kenya. They do not realise that high salaries is recipe for unemployment. Trade union leadership, although right in pushing for their members’ rights and welfare, have failed to educate them on inflationary consequences,” says Ong’wen.
Picketing workers in almost all sectors of the economy does not make it any easier for the economy to attract more investments and create more jobs as the trade unions press for salary hikes to match the cost of living, according to Dr Eric Aligula, the chief executive of the Kenya Institute for Public Policy Research and Analysis (Kippra).
“The basic question is: ‘Why are workers striking?’ It is because the cost of services is high. We need to manage speculative investments that create salary inequities. Inequality causes discontent,” says the Kippra boss.
Although public support favours them, outright yodellers, who do not understand their mandate, lead a majority of the trade. Consequently, there is a general feeling they are missing out on opportunities to protect their members against high cost of services by condoning free market economic policies that expose workers to the vicissitudes of supply and demand.
In the 1980s when the World Bank and International Monetary Fund (IMF) prescribed the Central Organisations of Trade Unions (Cotu) supports the Bretton Woods institutions. The ensuing public and private sector layoffs triggered high incidence of poverty, which in turn escalated insecurity and high cost of living.
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