Employment and Labor Relations
The south's successful economy kept unemployment rates
During the 1980s, unemployment rose above 3.3 percent only
1987, when it reached 3.7 percent. In 1988 unemployment
percent. Unemployment rates were also low in the years
the Turkish invasion of 1974, averaging about 1 percent.
invasion and division of the island disrupted the economy,
the government-controlled area unemployment averaged 16.2
in 1975 and 8.5 percent in 1976. During 1977 the rate fell
percent, a rate typical for the south's economy during the
The south's economy frequently had to contend with a
of workers and in some years was forced to import workers
abroad to meet the needs of various sectors, especially
industry. This shortfall reflected the changing employment
of the economy as a whole (see
table 11, Appendix). The
population group that consistently had difficulty finding
employment was composed of university graduates. Their
sometimes resulted in demonstrations and demands that the
service be expanded.
In 1973 about 37.5 percent of those gainfully employed
members of labor unions. Union membership increased
1974 and 1977, reaching 62 percent at the end of 1977.
continued, and in 1988 labor unions represented more than
percent of the work force.
The most prominent unions in the government-controlled
were the left-wing Pan-Cyprian Federation of Labor
Ergatiki Omospondia--PEO) with about 70,000 members at the
the 1980s, and the right-wing Cyprus Workers'
(Synomospondia Ergaton Kyprou--SEK) with about 50,000
Third in importance was the civil servants' labor union,
membership of about 13,000. Employers were organized in
associations represented in the Cyprus Employers' and
Terms and conditions of employment were negotiated
directly between employee and employer or through
bargaining between trade unions and employers'
government's policy was to remain largely uninvolved in
negotiations unless a deadlock had been reached or its
participation had been requested, when it acted through
Industrial Relations Section, a part of the Ministry of
Social Insurance. This section routinely acted to prevent
laboremployer discord by providing both groups with guidance
information about good industrial relations. As a result,
number of working days lost to strikes was among the
lowest in the
Western world relative to the size of the work force.
In the 1980s, wages rose faster than prices. A part of
increase was brought about through wage indexation, with
quarterly wage increases equal to about half the inflation
Even at this rate, however, wage increases could be
the economy. In 1988, for example, average wages and
increased 4.5 percent in real terms, but exceeded the
gain of 3.5 percent. The relative scarcity of labor and
labor costs affected the economy in the 1980s and were
continue to do in the 1990s.
Data as of January 1991