Swiss voters rebuff $25 minimum wage

Swiss voters overwhelmingly rejected a referendum to boost the nation's minimum wage to $25 per hour, amid fears that the increase could backfire if businesses responded by cutting workers' hours and jobs.

Peter Klaunzer/Keystone/AP
Persons watch first results of referendums in Bern Switzerland Sunday. Worried about upsetting Switzerland's strong economy or driving its high costs even higher, more than three-quarters of Swiss voters rejected a plan Sunday to create the world's highest minimum wage and slightly more than half spurned a request to outfit the Swiss Air Force with 22 new fighter jets.

Swiss voters on Sunday rejected proposals to introduce the world's highest minimum wage and spend $3.5 billion buying new Gripen fighter jets from Saab .

About 76 percent of voters in the wealthy nation dismissed the proposal made by Swiss union SGB and backed by the Socialist and Green parties for a minimum wage of 22 Swiss francs ($25) per hour, final results showed.

Some 53 percent blocked a plan to replace Switzerland's aging fleet of fighter jets with 22 Gripen jets from Saab. Just over 55 percent of those eligible voted, the government said.

The clear rejection of the proposed minimum wage – which corresponds to a monthly paycheck of 4,000 francs (about $4,500) – brings relief to business leaders worried the measure would have hurt competitiveness and damaged the Swiss workplace.

"If the initiative had been accepted, without doubt that would have led to job cuts, particularly in remote and structurally weaker regions," Swiss Economy Minister Johann Schneider-Ammann said at a news conference.

Sunday's vote is the latest initiative addressing a widening income gap in the generally egalitarian country. Voters approved giving shareholders a binding say on executive pay, but turned down a proposal to cap the salaries of top executives at 12 times that of a company's lowest wage.

Despite Sunday's "no", Daniel Lampart, chief economist at SGB, said the debate over the measure had led many companies to raise minimum wages to more than 4,000 francs. Discounter Lidl increased minimum Swiss salaries to 4,000 francs last year; retailer H&M says it will follow suit next year, although employers do not acknowledge a direct link to the proposal.

Swiss voters historically have vetoed what they feel are threats to the country's economic success. But they unexpectedly agreed in February to curb immigration from the European Union and last year backed the proposal to give shareholders a say over executive pay – ignoring warnings from business both times.

Narrow Gripen Defeat

The "no" vote for the Gripen jets bucks historical support for the military. Last September, the Swissvoted overwhelmingly in favor of keeping military conscription.

The government had argued that Switzerland needed modern fighters to support its armed forces.

"This decision will cause a security gap," Defense Minister Ueli Maurer said. "We will do everything we can to fill this gap in these difficult circumstances as quickly as is possible."

Switzerland was embarrassed earlier this year when a hijacked Ethiopian Airlines plane heading for Geneva had to be escorted by French and Italian fighters because the incident occurred outside business hours.

Although both the upper and lower houses of parliament backed the deal, Swiss interest groups – including socialists, Greens, and the Group for Switzerland without an Army – collected the 50,000 signatures needed to force a popular vote.

Opponents had argued buying the jets was an unnecessary expense, requiring cuts in other areas, such as education. They also said the cost of keeping the jets in operation was likely to spiral to at least 10 billion francs over their lifetime.

The defeat is also a setback for Sweden's Saab, but analysts have said they do not expect it to derail the future development of the Gripen.

Saab has a framework deal with Sweden for 60 new-generation jets for Sweden and potentially 22 for Switzerland, with which it had hoped to share development costs. It now looks to gain a partner in Brazil after Saab won a tender last year to supply planes to the country.

Swedish Defense Minister Karin Enstrom said she regretted the Swiss "no." Co-operation would have helped both countries, she said, and Sweden still needed to develop its fighter jet capacities. "We will have to analyze this and find a (different) way forward," she told Reuters.

Saab said the development and production of the jets for Sweden would continue. The Swissorder "was not something we had booked in our order backlog. We will not change our earnings forecast for this year nor our financial targets," Saab Chief Executive Hakan Bushke told Reuters.

Bushke said negotiations with Brazil were going well and he expected to complete the deal this year.

You've read  of  free articles. Subscribe to continue.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to