Originally Posted by
CamelSquadron
Its all about economics.
Get a 5% wage increase, then everyone else will be demanding a 5% increase instead of 3%. On a $4.3bn wage bill that extra 2% equates to an extra $86m per year. Get that increase for a second year and the cost increase is $172m over the 3% figure (before compounding). Its a simplified calculation but it illustrates the problem.
If turnover is $3.6 billion a year then a 1% increase via a fare rise equates to $36 million. I don’t know what Jetstar total wage bill is but it wouldn’t take much to cover it and I’m sure they fares up every year.