COMMENT

The real devaluation

By Nikos Konstandaras

For some time now, the high cost of the internal devaluation which the Greek economy is undergoing has been evident. Since 2010, gross domestic product has shrunk by 23 percent and employment has dropped by 20 percent, with the jobless rate hitting 27.3 percent in 2013. The General Confederation of Greek Labor’s (GSEE) annual report on the economy and employment, which was made public yesterday, is full of statistics but it cannot trace the real cost of devaluation – that which relates to people and their professional value.

We cannot measure in numbers the shock of an employee who suddenly finds himself outside the framework of his job, nor a young person’s fear that he or she cannot hope for a steady job. Whether it affects us or someone close to us, we all know what it means to have to redefine our identity because we have lost our job, or because the sector in which we are employed is sinking. A worker is part of a hierarchy, with clear boundaries, responsibilities and rewards. Jobless, we are adrift in society, our identity shaken.

While the recession lasts, people who are suddenly unemployed face the added woe of not knowing when they will find a job nor in which sector. Countless companies across the economy will not recover and their workers will have to acquire new skills and find new jobs – when jobs are created. From 2010 to 2013, the number of unemployed grew by 930,000 people, touching almost every family.

The crisis and long recession have resulted not only in high unemployment but also in the equally dangerous devaluation of professional values. According to the report by GSEE’s Labor Institute, from 2010-13, in current prices, incomes of salaried individuals and self-employed professionals were reduced by 41 billion euros. Those who still have jobs are paid less for what is often more work, because colleagues have been fired. Others are forced to take jobs below their skill level, or to emigrate. The investment in studies and work experience is thus lost to the Greek economy.

On the other hand, many employers do whatever they can to save their companies, reducing costs but also quality. By devaluing their products, they open the way for companies which exploit workers’ need for jobs, paying the lowest possible wages (often without social security) and producing low-quality goods. In the end, the pirate companies will wipe out the serious ones – another devaluation that society must face.

There are no easy solutions. The GSEE report says that growth and employment will be boosted if “the prices of domestic goods are reduced, if wages are raised and if there is a long-term improvement in structural competitiveness through investment in technology and restructuring of production modes.” No one disagrees with this but it is not easy to achieve. Until national and EU programs start making a difference, it is up to each of us to keep our sense of worth from dying.

Online