• Costa Rica Real Estate

Minimum Wages Hiked 6.58% in Private Sector

June 27, 2008

The National Salary Council this week green-lighted a 6.58 percent increase of minimum wages in the private sector to start Tuesday, which the Labor Ministry (MTSS) says should “recuperate the purchasing power” of the nation’s lowest earners faced with rising living costs.

On top of that, unskilled low-wage earners such as cleaning staff and delivery workers should receive an added 5,000 colones ($9.60) to their monthly paychecks, and an extra ¢4,000 will go to semi-skilled workers, including drivers, shop attendants, guards and low-earning office personnel. It is the second raise this year after January’s increase of 5.1 percent.

Some labor leaders, however, are not content. They say the raise from ¢164,007 (about $315.60) a month to less than ¢180,000 ($346.40) just scratches the surface of the need.

“We’re not totally satisfied because the salary gap is difficult to resolve with a halfyearly wage raise.What’s needed is a sustained policy of recuperating the purchasing power of salaries,” Albino Vargas, secretary general of the National Association of Public and Private Employees (ANEP), told The Tico Times. “What happened (Monday) was a circumstantial adjustment and, furthermore, it’ll be difficult to check if companies follow through with it.”

In addition to more cohesive government measures, ANEP was bidding for at least a 10 percent raise, Vargas said.

But Labor Ministry Spokeswoman Ana Isabel Gartela said that while the wage increase is meant for low earners, in many companies it ends up benefitting all employees, as employers often use it as an opportunity to give pay raises across the board.

She said the government takes into account the cost of living with each salary hike. Accumulative inflation from January to June has reached 5.94 percent. The ministry added that number to 0.64 – which was the difference between predicted and actual inflation for December, when the last salary adjustment was calculated – to arrive at the mininum wage increase of 6.58 percent.

The raise will be the highest since the 6.84 percent increase of January 2006, according to another ministry spokesman, Geovanny Díaz. Private sector minimum wages rose by 5.1 percent last July and by 4.95 percent in January 2007, Díaz said.

–Alex Leff

 

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