The industrial relations debate has been hijacked by the right, and any left-wing protestation about real wages won't do anything to change the tune, writes Greg Jericho.

Let's be blunt. The industrial relation pendulum has swung too far one way. There is almost no doubt the Fair Work Act (FWA), introduced by the ALP in 2009, has seen the IR pendulum, as it was under WorkChoices stay massively swung in favour of the bosses.

The IR debate in this country has long been a complete farce. We are told we need IR "reform" because of productivity and competitiveness, because the militant unions have too much power.

But it's a fib.

This wouldn't matter so much but the problem is those who argue on behalf of workers and those (like me) who write in the media from a left-wing perspective have also become trapped within this fib.

A wage boom? Hell no, the left responds, look at the evidence!

I have written many, many (many!) times how under the FWA wages have not boomed. Indeed the latest wages price index released two weeks ago showed that wages in the past year had actually fallen in real terms.

In February the Minister for Employment, Senator Eric Abetz, had suggested, like the broken down gramophone that he is, that there was a risk of a "wages explosion". So I'll now pause for you to go read his media release noting the record low growth in wages and praising the IR system that produced it.

No, don't bother. You and I both know there isn't one.

There never is.

But the spittle-dribbling, brain-dulled cry of "wages explosion" is always there - from Senator Abetz, or Joe Hockey, or Tony Abbott or any of their cheerleaders in the media. The recognition of reality? Hell no.

Last week as well the ABS's most recent "Employee earnings, benefits and trade union membership" figures showed that the median wage from 2012 to 2013 did not rise, and thus it also fell in real terms:

Since the introduction of the FWA, the annual real rise in median wage has averaged just 0.5 per cent - the lowest four years average since 2002-2005.

But again, go seek the commentary lauding the great flexible IR system we have that saw wages fall in line with employment growth.

*Crickets*

But there was commentary on the decision last week by the Fair Work Commission to increase the minimum wage by 3 per cent in the next 12 months. Given the Reserve Bank expects inflation over the next 12 months to grow by anywhere between 2.5 per cent to 3.5 per cent, that suggests those on minimum wage will receive anything from a 0.5 per cent real wage increase to possibly a real wage cut.

Last year the Fair Work Commission approved a 2.6 per cent increase in the minimum wage, and given inflation has risen by 2.9 per cent, the minimum wage, like everyone else's fell in real terms.

So surely the decision was nothing to get too excited about?

Except no. Hockey on Sky News said the decision would hurt employment growth, because the decision "flows right through to even people above $150,000 a year, getting that sort of increase".

I'm going to go out on a limb and say that people on $150,000 a year would have been expecting a bit more than 0 per cent real increase in wages.

The Fair Work Commission considered all the arguments and international studies on the impact of minimum wage rises on employment. It found that "modest minimum wage adjustments lead to a small, or zero, effect on employment". It also noted that "the annual wage review is but one factor in individual labour supply decisions."

It's always refreshing to hear someone state that the economy is more complex than our political leaders would have us believe.

Similarly, the Productivity Commission on Friday handed down its interim report on the relative costs of doing business in retail trade. It found that labour was the major cost of the retail industry, but the picture was complex. In the clothing sector labour and rent costs were much higher than international competitors, but in other sectors, such as department stores, furniture and supermarkets, "there are no discernible differences in cost structures between Australian retailers and those operating in broadly comparable markets overseas."

So if not a wages boom, what then? How about militant unions leading workers in industrial action?

Well last week's industrial disputes data showed the March quarter had the third fewest ever days lost to industrial disputes:

In year-on-year terms, the March quarter recorded the fifth lowest 12 months period of days lost:

This is not surprising. The big spikes in strikes in the past few years occurred mostly due to state public sector workers who were not covered by the FWA. That didn't stop certain employer groups trying to suggest there was a link.

But again we have become locked into the right-wing view. Striking for better wages and conditions - a fundamental right of labour - is somehow bad, and a sign of workers and unions who care not for productivity - despite the number of strikes having next to no link with productivity growth.

But this is not surprising as productivity is also misused in this debate.

If we are honest, the IR system now has minimal impact on productivity. As soon as we shifted from pattern to enterprise bargaining under the Keating government, the big improvement had been done. From then on you would be lucky to find any evidence of IR changes actually improving national productivity.

The national accounts last week showed that productivity in the past five years has been growing as well as it has for a decade.

Is that due to the FWA? Maybe. Probably not. Most likely it is due to the mining industry shifting from the low productivity investment boom to the more productive (with fewer workers) production and export phase.

But it is worth nothing that Australia's productivity improved even while the mining boom in 2010-12 occurred. And there is nothing from the national accounts that could lead you to suggest WorkChoices produced a better productivity outcome than the FWA.

So what is the IR debate about if not ending a wages boom, lowering strikes and increasing productivity?

Well last week, Gina Rinehart let us all know. It is about money - and particularly about more money for the owners of companies and less money for the workers.

Ms Rinehart suggested Australia needed "jealousy-inspiring profits" to encourage investment (ignoring we have just seen absurd increases in investment in the past four years). And how will these jealous profits be achieved? Why reducing costs of course. And let's not pretend we're talking capital costs. For the woman who looked with jealousy at those in Africa charging their workers $2 a day, it's all about labour.

And again we see this call despite real labour costs continuing to fall (as they have been for 30 years):

After the steep fall in costs due to the GFC, and the rise in real costs in 2012 due to abnormally low inflation, the trend of falling costs continues.

And also falling again is the proportion of national income going to workers. During the GFC the proportion of income going to workers fell dramatically. It then improved, but in the past year has returned to the 30 year falling trend:

And where does the share of income go if not to the workers? To company profits:

And this is what IR really is about - who gets what share of the national income pie.

But don't worry. None of this data will change the tune. We'll still hear the call for more reform, more flexibility (code for easier ability to fire workers and pay them less).

We'll still hear cries about wages booms, militant unions, low productivity and declining profits. Those on the left will then show how wages growth and strikes are low, and that productivity and profits are rising.

And their critics will inwardly smile, knowing they are getting what they want, and then they will just keep asking for more.

Greg Jericho writes weekly for The Drum. His blog can be found here and he tweets at @grogsgamut. View his full profile here.