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National strike could cost €360 million

© Belga
A strike picket at a Delhaize distribution centre in Ninove
© Belga

The impact of yesterday’s national strike was less than predicted, with only 4% of small company employees taking part, rising to 25% in companies with more than 50 employees, according to an evaluation by Unizo, the organisation that represents the self-employed. The strike originated with the breakdown of talks over pay between employers and unions representing private-sector workers. However the strike notice was framed in such a way as to give official coverage to workers in the public sector who wished to down tools.

The main effects were felt in public transport, with the rail authority and the three regional transport networks at a virtual standstill – leading to a knock-on effect as employees chose to work from home or were simply unable to get to work by alternative means. Brussels Airport stopped operating as air traffic controllers closed down the airspace over Belgium.

The stoppage cost Brussels Airport itself an estimated 10 to 13 million euros in lost revenue, according to Marc Descheemaecker, chairman of the airport company speaking on the VRT. The losses come from landing fees from cancelled flights: Brussels Airlines cancelled all of the day’s 222 flights, while TUI switched its flights to airports in France and the Netherlands. Other losses are accounted for by the lack of passengers eating, drinking and shopping at airport businesses – although that spending in many cases has been postponed rather that cancelled entirely.

Overall, the strike is likely to have cost the Belgian economy about 360 million euros, according to economist Stijn Decock, reported in Het Nieuwsblad. The figure is based on 20% of the workforce either choosing to strike or unable to work because others are on strike. The actual loss of income will take longer to work out.

According to Decock, the economy generates about 400 billion euros a year in added value, which spread over an average of 220 working days comes to 1.8 billion euros a day. A loss of 20% of the workforce would put the cost for a strike on Wednesday at 360 million euros.

The state takes about 50% of that added value income in taxes and other duties, putting the loss to the treasury at 180 million euros.

“That sort of calculation is the most accurate we can make of the impact of a day of strikes,” according to Paul Degrauwe, former economics professor at the university of Leuven, now at the London School of Economics. “But we have to add a footnote to say that that loss is not permanent,” he told the paper. “A lot of the work that was not done will be made up later, so that the economic and fiscal damage will ultimately be less severe.”

Alan Hope
The Brussels Times