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CANBERRA - Prime Minister Kevin Rudd's Labor Government appears set on a collision course with the union movement as wage demands soar despite the global financial crisis and rising unemployment.
Unions have rejected Acting Prime Minister Julia Gillard's calls for restraint and have instead attacked "knee-jerk" redundancies by
companies expecting a grim 12 months ahead.
They have also made it clear that they expect the Government to place job protection at the head of its agenda, even as claims are being lodged for pay rises of up to 33 per cent in the troubled mining sector.
"The new business mantra for 2009 must be the three Rs - retain, reskill and redeploy," said Australian Council of Trade Unions president Sharan Burrow.
"A knee-jerk response of redundancies and retrenchments would not only exact a human toll, but would be counterproductive for employers and the economy."
The emerging clash between unions, Government and business comes as the Australian economy continues to slide as the key resources sector reels from a series of export blows, and as important domestic sectors such as building and construction continue to be hammered.
Forecasts predict that tens of thousands of workers will join those who have already lost their jobs because of the global crisis.
While most expect unemployment to rise from the present 4.4 per cent to almost 7 per cent, the gloomiest predict the number out of work could almost double, to close to one million.
Yesterday a Morgan poll reported the true unemployment rate in December had already reached 6.4 per cent, and that, with part-timers included, 13.2 per cent of the workforce was either out of a job or underemployed.
This year's first monthly survey of investor confidence by the Australian Chamber of Commerce and Industry said that with national economic conditions and expected economic growth at their lowest levels since the survey began a decade ago, business was expecting to shed more jobs.
The building industry holds similar expectations.
But in Western Australia the mining division of the Construction, Forestry, Mining and Energy Union is demanding pay increases of between 25 and 33 per cent for boiler and turbine operators employed by aluminium producer Alcoa.
Alcoa recently announced a reduction of more than 13,000 in its global workforce and an 18 per cent reduction in capacity. The union is also seeking pay rises of between 5 per cent and 10 per cent for other WA power plant workers, and train drivers working for miners in the northern Pilbara region are reportedly preparing to resume rolling strikes against Rio Tinto Iron Ore in support of their pay claims.
Urging restraint, Gillard said unions needed to consider wage claims in the context of rising unemployment and economic turmoil.
"Our message to everybody, to unions, to employers, is these are difficult times," she told ABC radio.
"After the global financial crisis, our economy is not going to be untouched and the most important thing is to make sure that Australians are still in work. We want to minimise any job losses and we're obviously asking people to take a responsible approach to that."
Since the crisis began biting, the Government has launched an A$10.2 billion economic security strategy, pumping money into key employment-creating sectors, handed the car industry A$6 billion, and provided an extra A$300 million to local government.
But Burrow said the Government needed to do more, supported the Alcoa workers and warned business against using the crisis as an excuse for job-shedding.
"We've got to be very cautious to work our way through what is real pressures on businesses and what is indeed simply an excuse."
