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Real wages to slip in 2009, U.N. jobs agency says

Published 11/03/2009, 06:12 AM
Updated 11/03/2009, 06:15 AM

* ILO warns low pay could undercut economic recovery * Says too early to phase out government rescue packages

GENEVA, Nov 3 (Reuters) - Inflation-adjusted wages stagnated last year and are likely to drop in 2009 despite signs that the global economy is gaining steam, a United Nations agency said on Tuesday.

"The picture on wages is likely to get worse in 2009," the International Labour Organisation (ILO) said in its latest Global Wage Report.

Real monthly wages fell in the first quarter of 2009 in half of the 35 wealthy and developing countries the ILO surveyed. Without an improvement in take-home pay levels, consumer demand and confidence levels could remain weak and undercut a rebound, the agency said.

"The continued deterioration of real wages worldwide raises serious questions about the true extent of an economic recovery, especially if government rescue packages are phased out too early," the report's lead author Manuela Tomei said.

In 2008 real average wages in a sample of 53 countries rose just 1.4 percent, compared with a 4.3 percent increase the year before.

Among the 10 members of the G20 leading economies that the ILO obtained data from, real average wages slipped 0.2 percent last year after a 1.0 percent rise in 2007. (Reporting by Laura MacInnis; editing by David Stamp)

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