The Shrinkage of Labour Cost as a Means of Facing the Economic Crisis in Greece and the EU: Realism or Utopia?

The article examines whether the dramatic reduction of the labour cost constitutes a substantial means of facing the economic crisis. The two main components of labour costs – wages and salaries and non-wage costs– are examined. Emphasis is given on the great differences between the member-states of the European Union concerning minimum wages, nominal hourly labour cost and its components, while the new legislation for the intervention in wages policy is mentioned. With an indicative reference to unemployment and poverty rates both in Greece and the EU because of the economic crisis, the necessary intervention of the EU in social and employment policies for the reinforcement of social cohesion is discussed.