The small business lobby group ISME has said that labour cost increases must be brought into line with the EU average to avoid Ireland's competitiveness being eroded.
ISME today published a survey of 400 enterprises showing that wages across all sectors rose by an average of 6.2% this year - more than twice the European average of 2.8%.
They say that over three years, Irish wage costs have risen by an average of 24%, compared with a 9% increase in Europe over the same period.
They blame increased wage demands on Government stealth taxes, continuing labour shortages in certain sectors, high average inflation during 2003, and the cost of housing.
27% of firms surveyed expressed concern about the impact of the forthcoming increase in the minimum wage on their businesses.
Their concern echoes a view expressed yesterday by the Chambers of Commerce of Ireland, which called for next February's 65c per hour increase to be phased in over two years.
However, the Irish Congress of Trade Unions has condemned the Chambers of Commerce of Ireland's suggestion as unbelievably selfish and insulting.
