Proposed doubling of minimum wage triggers private sector concerns

The Jamaica Chamber of Commerce (JCC) is warning that a Jamaica Labour Party (JLP) proposal to double the minimum wage on a phased basis could result in job losses or increased costs being passed on to consumers.

The private-sector body urged the Government not to depart from the minimum wage consultative process, as it could create significant disruption to businesses and the broader economy.

“Since any increase in the minimum wage can potentially result in increased unemployment or result in increased costs being passed on to consumers, decisions of this nature must be grounded in collaboration and transparency,” the JCC said in a statement yesterday.

Prime Minister Dr Andrew Holness announced on Sunday that a government led by him in the next term would increase the minimum wage to $32,000 over “the next few years”.

The national minimum wage is now $16,000 per 40-hour workweek.

Not an afterthought

During a JLP press conference yesterday, the party’s Campaign Committee Chairman Dr Christopher Tufton defended the planned move to increase the minimum wage, saying it was not an afterthought but part of the JLP’s plans to better the lives of Jamaicans amid improvements in the economy.

Tufton said the ruling party has achieved many successes that have benefited Jamaicans and that it plans to build on these for the third term, if elected.

Tufton said moving up the minimum wage is a part of that effort, saying the JLP, unlike the PNP, is not all over the place and has been consistent in its pronouncements to Jamaicans.

While acknowledging that Jamaicans should earn a liveable wage, the JCC emphasised that the established consultative process should be adhered to before committing the country to such an obligation.

According to the JCC, the law provides for a consultative process that involves dialogue between the government, private sector, trade unions, civil society, and academia, with careful consideration given to factors such as the cost of living, food prices, and overall economic conditions.

In light of the ongoing election cycle, the JCC also called for the two main political parties to ensure that any major commitments within their manifestos or made on a political platform are accompanied by clear, detailed explanations of how they would be funded and implemented.

At the same time, President of the Jamaica Employers’ Federation (JEF) Wayne Chen said while his organisation supports real increases in wages for Jamaicans, especially those lowest paid, there is the need for increased productivity.

“For sustainability and realism, we have to bring into the discussion productivity,” Chen said.

The JEF head said increasing wages without commensurate increases in productivity is not sustainable.

“In parallel to the discussion around a phased increase in the minimum wage, we must now do the hard work of removing the long-standing impediments to productivity and sustained and inclusive economic growth,” he said.

Chen argued that the administration has done well in building a platform supported by strong macroeconomic indicators.

However, he said the country has to embrace new technology and skills training in an aggressive way for both the young and adults.

According to Chen, lifelong learning and the upskilling of everyone is going to be a critical discussion on September 4.

The reform of the education sector will also be a critical subject for discussion after the election, Chen added.

During a press conference yesterday, People’s National Party (PNP) spokesman Cleveland Tomlinson cautioned against the politicisation of the minimum wage.

He argued that the proposed doubling of the minimum wage by the JLP was done in a last-minute rush to garner votes.

Tomlinson said increasing the minimum wage requires a careful balancing act to ensure that all stakeholders are taken into account.

According to Tomlinson, an increase in the minimum wage must be consistent with the movement in the rate of inflation.

The PNP spokesman said his party has placed in its manifesto a commitment to implementing a liveable wage. He said a liveable wage commission will be established to facilitate consultation and consensus building to arrive at a liveable wage for Jamaicans.

At the same time, PNP spokesman Raymond Pryce said that throughout the series of just-concluded national debates, none of the JLP spokespersons, including the ministers of labour and finance, as well as the prime minister, mentioned the doubling of the minimum wage.

“This is a late-in-the-day clutching at the straw to try and salvage a dying campaign,” he said.

edmond.campbell@gleanerjm.com