The Irish Union, representing construction workers, has warned that an economic recession will be worse than previously forecast, if wages fail to rise above inflation.

The same union has suggested the government cut funding on infrastructural improvement schemes, which are currently providing a glimmer of hope for faltering building firms in the country.

SIPTU, the country's largest trade union, said recent predictions are wrong in suggesting the drop in consumption growth can be attributed to a weakening of consumer confidence.

The union's Head of Research, Manus O'Riordan, has instead insisted that it is the result of a decrease in actual workers earnings.

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The research official said that consumer-spending growth could not be recovered, unless wages, across the board, are increased.

However, the union has said that a pay rise inline with inflation would be the same as a pay restraint, as this increase would merely adjust living standards.

SIPTU has claimed the gloom predicted by the government is not as bad as it seems, and has suggested the central government should break EU borrowing guidelines, instead of engaging in dramatic spending cuts.

But Mr O'Riordan has also made some other, more controversial, suggestions, which are likely to anger those within the construction sector, who are suffering worst from the current financial climate.

The researcher said the government should cut back on infrastructural improvements, a move likely to reduce work for builders.

He also recommended the Dublin Metro rail should be postponed, and that training under the National Development Plan be prioritised.

(PR/JM)