Discussion of the minimum wage is back on the national agenda with a business organization and a social development agency urging increases that would be rather higher than those seen in past years.
Coneval, the agency responsible for the measurement of poverty levels, has recommended an increase of 17.5%, which would add 14 pesos to the current minimum wage of 80.04.
Coming in slightly lower was Coparmex, the Mexican Employers Federation, which proposed a 15.8% increase, or 12.68 pesos more.
The minimum wage is reviewed annually by the National Minimum Wage Commission (Conasami) and changes go into effect January 1 each year.
This year it went up almost 10%, or seven pesos.
Yesterday, the executive secretary of Coneval warned that if the federal government didn’t raise the minimum wage it ran the risk of increased poverty given this year’s inflation rates, the highest in the last eight years.
Gonzalo Hernández Licona explained that during the second quarter the cost of the basic basket of goods increased by 7%, negatively impacting purchasing power.
He said the impact could be reverted through an increase in income.
Poverty levels could decline if inflation does the same, or through an increase in the minimum wage, he said.
“I believe that it is important to keep encouraging a rise in the minimum wage this year,” said Hernández, noting that the population with the lowest income levels would benefit the most.
Mexico’s minimum wage is much lower than that of other Latin American countries, he pointed out.
A longstanding argument against large increases in the basic wage is the danger of fueling inflation.
But Coparmex believes the increase it has proposed would have no such impact, but instead help workers recover some purchasing power.
Federation president Gustavo Adolfo de Hoyos Walther said the salary hike at the beginning of the year did not create inflationary pressures either.
“The rise was not inflationary. The products that have had an impact on inflation are not related to the work force, but to fuel and the exchange rate,” he said.
Coneval’s Hernández agreed that an increase of about 14 pesos per day would not affect inflation or the job market.
Coparmex’ proposed increase is part of a larger campaign announced last week that calls for gradual increases over a dozen years, bringing the wage up to a range between 162 and 195 pesos a day. The organization is to present its “new wage culture” proposal to the Labor Secretariat today.