Lobby group boss calls for freeze on minimum wage hikes

ONE of Co Carlow’s leading businessmen and chair of Retail Excellence Ireland (REI) is calling on the government to indefinitely pause minimum wage increases until the commercial environment becomes more sustainable.

Fergal Doyle, co-owner and CCO of the Arboretum in Leighlinbridge and chair of the largest representative body for the retail industry, has called on the government to indefinitely pause any increases in the minimum wage, warning that retail businesses are facing an “intensely difficult” commercial environment.

“As chair of REI, I fully support the government’s decision to pause the introduction of the living wage until 2029. But we must go further. We are calling for an indefinite pause to minimum wage increases until the commercial environment becomes more sustainable,” said Mr Doyle.

“Between 2020 and 2025, the minimum wage has risen by 38%. Meanwhile, insolvencies in the retail sector have soared, with 200 businesses lost in 2024 alone. This is not about resisting change; it’s about recognising that blunt instruments like wage hikes don’t work when businesses are fighting to survive,” Mr Doyle said.

“It’s time for targeted support and smarter policy. Let’s not lose more of our vibrant retail community,” he added.

REI has also called on the government to reintroduce and expand the Increased Cost of Business (ICOB) scheme, which allocated €257 million for SMEs in October 2023 as part of Budget 2024. This scheme offered eligible businesses a one-off grant payment as a contribution towards business costs based on the value of their commercial rates bill. The scheme was closed in May last year.

Welcoming the government’s decision to pause the introduction of the living wage until 2029, REI says the methodology for its calculation needed to be revisited.

The organisation believes that Ireland’s status as an outlier in the EU due to our significantly higher number of high-paid jobs in sectors such as pharma and tech is skewing the data and is not truly reflective of the broader economy.

REI recently published a report on the retail industry by economist Jim Power titled The cost of doing business: Ireland’s retail sector in a European context.

“The operating environment for many retailers has been intensely challenging in recent years. There has been a massive escalation in the costs of doing business, including energy costs, insurance costs, labour costs and compliance costs,” said Jim Power, the author of the report.

“Furthermore, retailers are generally very labour intensive, so labour costs and other labour market regulations in areas such as paid sick days and parental leave impose an inordinate financial and logistical burden. Where comparable data is available, it is also clear that the cost of doing business in Ireland is very high compared to our EU peers.”