Government sets the average minimum wage at $721
Juan Carlos Varela, President of the Republic announced last night an increase in the minimum wage.
Larger companies will incur an increase of 6.5% while small businesses have an increase of 4.5%, to take in effect from January 1, 2018, to December 31, 2019. The decision was adopted by the government when 6 months of negotiations between workers and businesses failed to arrive at a consensus.
The average monthly minimum wage for the region which includes all the provinces except for the Davren and its counties will increase from $677 to $721 while Region 2, will rise from $529 to $563. This adjustment will benefit 292,000 workers.
The National Council of Private Enterprise (CONEP) described this increase as an as exaggerated and unsustainable increase. "We had hoped for a smaller increase and that any type of subjective, populist and pre-electoral analysis would be left out of this type of adjustment", said Gonzales, former president of the Panamanian Association of Business Executives (Apede). He also added that ideally the increase would have been set according to business activities since not all of them grow at the same rate. ’’We hope that this new minimum wage does not translate into labor terminations or the loss of decent and formal jobs’’.
The cost of the basic basket, the price index and the economic growth over the last few years were taken into account in assigning the new adjustments.