Report of substantial increases in management pay worries LO
Published: 27 November 1997
A recent report from Norsk Institutt for personalutvikling og administrasjon (NIPA) indicates that management salaries within the private sector have increased significantly over the past year. Salaries have increased most for top management, with an increase of 28% from 1 September 1996 to 1 September 1997. However, managers below this level have also received increases which significantly exceed the average wage growth for Norwegian wage earners. The study is based on a survey which covers 1,600 managers in 53 private firms.
According to a report published in late 1997, managers in private firms have received substantial salary increases over 1996-7. The president of the Norwegian Confederation of Trade Unions fears that the substantial salary increases amongst management will make it difficult to attain sufficient support for a moderate wage settlement.
A recent report from Norsk Institutt for personalutvikling og administrasjon (NIPA) indicates that management salaries within the private sector have increased significantly over the past year. Salaries have increased most for top management, with an increase of 28% from 1 September 1996 to 1 September 1997. However, managers below this level have also received increases which significantly exceed the average wage growth for Norwegian wage earners. The study is based on a survey which covers 1,600 managers in 53 private firms.
In a commentary in the newspaper Dagens Næringsliv (22 November 1997), the director of the Confederation of Norwegian Business and Industry (Næringslivets Hovedorganisasjon, NHO), Karl Glad, stated that the figures provided by the NIPA survey do not correspond to the information NHO has received from its member firms. NHO's own estimates, which do not include top management, indicate a much lower growth in pay for salaried employees. Mr Glad admits, however, that the wage growth for salaried employees has been somewhat higher relative to other groups within firms, and regrets that many member firms have not followed NHO's recommendation that all groups within firms should have equal treatment. This was one of the objectives of the pay agreement which the Norwegian Confederation of Trade Unions (Landsorganisasjonen i Norge, LO) and NHO agreed in the spring of 1997 (NO9704108F).
At LO-State's annual conference in November, LO's president, Yngve Hågensen, expressed concern about the increase in management salaries, and stated that LO will initiate its own survey of the issue. The LO president emphasised that the past years' moderate wage settlements have given wage earners improved purchasing power. However, substantial increases accorded to management, as well as the incomes policy of the new union confederation for professionals, Akademikerne (NO9711133F), may mean that LO's members will demand high wage increases during the forthcoming wage settlement in spring 1998 (Dagsavisen Arbeiderbladet, 27 November 1997).
More exact figures for pay determination in Norway will be presented in the report which is produced by the joint public committee, the Technical Calculating Committee on Income Settlement. The reports from this committee constitute an important basis of information for pay settlements. So far the estimates from Statistics Norway indicate that the wage growth for 1997 will be approximately 3.9%, which is slightly lower than the previous year (according to Økonomisk Utsyn 6/97).
Eurofound recommends citing this publication in the following way.
Eurofound (1997), Report of substantial increases in management pay worries LO, article.
