Examining the Minimum Wage Council’s Importance on Unemployment Benefits and Purchasing Power in a Time of High Inflation

The Government has set a virtual meeting for the Minimum, Vital and Mobile Salary Council (SMVM) on July 18 at 2:30 p.m. The purpose of the meeting is to determine the value of the SMVM and unemployment benefits. If no agreement is reached, the Government will make the final decision. Inflation in May was 71.9%, which resulted in a 12.7% deterioration in purchasing power for those earning less than the minimum wage.

At previous Council meetings, the Government had to set minimum wage values due to lack of agreement between business and union representatives. In January, the Ministry of Labor set a monthly value of $180,000 or $900 per hour for February, and $202,800 or $1,014 per hour for March. The minimum wage for April was set at $221,052 for monthly workers and $1,105.26 per hour for daily workers, representing a 9% increase from March. In May, the SMVM rose to $234,315.12 for monthly workers and $1,171.58 per hour, a 6% increase from April.

The minimum wage impacts registered monthly or daily wage workers directly and indirectly influences unregistered or informal workers by affecting their wages and purchasing power. Retirees with 30 or more years of contributions are entitled to 82% of the SMVM. On average, unemployed individuals receive 75% of their previous normal monthly remuneration as unemployment benefits