LABOUR-BRAZIL: Economic Recovery Helps Spur Strikes for Wage Rises

By Mario Osava Reprint | | Print |

Mario Osava

RIO DE JANEIRO, Sep 28 2004 (IPS) - Brazil’s current economic recovery, following a long period of stagnation and unemployment, has prompted a wave of strikes in which workers are demanding wage hikes after years of declining buying power.

Judicial functionaries in the state of Sao Paulo returned to work Tuesday after a 91-day strike. But bank employees decided to continue the work stoppage they declared 14 days ago, and pilots working for Brazil’s VASP airline went on strike Tuesday and Wednesday to demand the payment of back wages.

The 106,000 metalworkers in ABC, industrial suburbs of the southern city of Sao Paulo which developed major steel, auto and other heavy industry in the 1970s and 1980s, have also begun to hold a series of stoppages in companies that refuse to agree to a 9.57 percent wage rise.

The pressure by the metalworkers’ trade union – which for years was led by current leftist President Luiz Inácio Lula da Silva – has already achieved agreements in dozens of companies.

Oil and chemical industry workers are also threatening to go on strike if their demands for higher wages and better working conditions are not met.

The work stoppages are taking advantage of the economic growth that this country of 178 million is enjoying after “10 years of shrinking wages,” said Joao Antonio Felicio, secretary-general of the Central Unica de Trabalhadores (CUT), Brazil’s largest trade union federation.

Economists and analysts project Gross Domestic Product (GDP) growth of at least four percent this year. GDP expanded 5.7 percent in the second quarter, the strongest rate since 1996.

And the Labour Ministry reported the creation of nearly 1.5 million new jobs in the country between January and August.

Labour activism, which was basically dormant for years because of the fears generated by growing unemployment, has now been jolted awake, said Felicio.

A study by the Inter-Union Department for Statistics and Socioeconomic Studies found that in the first half of the year, trade unions were successful in regaining lost wages in 79 percent of their collective bargaining efforts, “reverting an eight-year tendency” during which inflation steadily ate away at workers’ real incomes, said Felicio.

For years, the average wage earned by Brazilians has been gradually shrinking, by 12.5 percent in metropolitan regions last year, compared to a 0.2 percent contraction of the economy in the same period.

CUT called for workers to launch a campaign to recover wages in the second half of the year, when conditions for applying pressure are more favourable due to the rise in production geared towards the increased demand and consumption of the year-end holidays, when employees are paid a Christmas bonus, said Felicio.

Wage-earners have seen their buying power plummet during years of a sluggish economy.

Bank employees, who totalled 800,000 nationwide 15 years ago, number half that total today, and their average salary has shrunk as banks have cut costs and watched their profits grow, Felicio said to illustrate.

Bank employees are on strike to demand a 25 percent wage hike, instead of the 12.77 percent offered by the banks, which would represent only a small real increase, as cumulative inflation has stood at 7.18 percent in the past 12 months.

The stoppage declared by bank workers has been only partial, and has had a stronger impact on the state-owned Banco do Brasil and Caja Económica Federal.

The measure has caused problems for the public, although automatic teller machines and on-line transactions have helped people get around the difficulties.

But the prolongation of the strike could bring serious consequences for the 23 million retirees who begin to draw their monthly pensions from the state-run banks on Sep. 30.

Labour Minister Ricardo Berzoini, a former head of the bank employees’ union, refused to support his former colleagues and criticised what he said was an attempt to influence the Oct. 3 municipal elections.

In the meantime, analysts have described the 48-hour stoppage by the VASP airline pilots as a kind of “suicide strike”, because their company is facing a serious financial crisis. Salaries have suffered months of delays. And in the past week, many flights have had to be cancelled because of a shortage of airplanes in safe condition to fly.

Felicio predicted further strikes in the next few months by public employees of the state of Sao Paulo, who he says are basically condemned to a diet of “bread and water”, earning wages that have been frozen for eight years.

For the past three months, striking state employees brought the Sao Paulo justice system to a halt. More than 12 million legal cases were paralysed and 450,000 court hearings were cancelled, said the president of the Bar Association of Sao Paulo, Luiz Flavio D’Urso.

The Sao Paulo judicial functionaries were initially calling for a nearly 40 percent raise, arguing that their wages had not been indexed to inflation for years. But they accepted an increase of just 14.5 percent when the state government argued that the budget was too short of funds to provide a larger wage hike.

However, the judicial workers announced that they are still on a state of alert and will walk out if their wages are docked for the days they were on strike.