A few charts from the Eurofound website provides an insightful glimpse into the conditions of workers in Greece in the context of austerity. The first chart, taken from Eurofound, demonstrates the trajectory of labour costs and labour productivity in Greece up to and during the crisis. The data indicates a significant divergence of labour costs and labour productivity under austerity. Effectively, austerity is pushing down labour costs, resulting in increases in Greek labour productivity.
Increased labour productivity, however, can largely be explained as a result of declining compensation per worker, as opposed to being the result of innovations stemming from increased investment.
Indeed, investment – in the form of Gross fixed capital formation – has been in freefall since the onset of austerity.
Lastly, collectively agreed pay has all but vanished from Greek industrial relations, explaining the decline in worker compensation.