With an approval rating of 4%—according to an Ipsos survey—and a series of questions about her management and the people around her, the president Dina Boluarte decided to bet on populism and play its last card of the year: the increase in minimum vital remuneration (RMV).
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In a speech of less than 10 minutes from Government Palaceand accompanied by the Minister of Labor and Employment Promotion, Daniel Mauratethe head of state announced that from January 1, 2025, that is, in less than a week, the minimum wage It will increase by S/105 and will become S/1,130.
Without technical arguments, the president tried to justify this decision by assuring: “We cannot allow Peru to grow at high rates and for this progress not to be felt in the pockets of the workers.” This rate referred to is the 3.2% that is projected for this year, but which the head of the Ministry of Economy and Finance, José Arista, has described as “insufficient” to combat poverty and inequality.
Boluarte He also wanted to support his decision under the excuse that the private investment “it recovers significantly”, although he forgot to mention that this year it would barely grow 2.3%, after a fall of more than 7% in 2023.
Although it did not specify what factors were taken into account for the increase in RMVthe president assured that the decision was made based on a “professional technical” analysis.
“We made this decision responsibly and thinking about the well-being of Peruvians. We do not do it thinking about cheap populism or political opportunism. We do it thinking about the families, the homes of all our compatriots,” he assured.
The president maintained that her administration will work to maintain an environment conducive to the growth and generation of profits in “certain business sectors.” In this case, he also did not mention what actions will be taken to help micro and small businesses (mype), which through their various unions have already spoken out against this increase.
To conclude, and again without specifying why the increase will be S/105 and not another figure, Boluarte He pointed out that the increase was not greater because it could affect the labor formalization process of the mype. It should be noted that the informality rate in Peru is around 75%, which affects, among other things, the creation of quality employment and tax collection.
TOTAL REJECTION
Various unions and sectors have been against this decision. The president of the Confiep, Alfonso Bustamante Cannytold this newspaper that growth of more than 3% should not be used as an argument, because he pointed out that this advance responds mainly to metal prices, greater exports and increased consumption, as a result of free access to the CTS. and AFP funds.
In that sense, he said that only between 2% and 3% of the formal workforce in the country directly benefits from the increase, and assured that the large company registers salaries that are above the RMV.
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Meanwhile, the former Minister of Economy and Finance David Tuesta indicated that the decision affects the productivity of the mypes and that, contrary to the arguments of the head of state, also hits the formalization process.
Both Tuesta and Bustamante Canny considered that it is necessary to apply the technical formula for future increases in the minimum remunerationso that business is not harmed.
For its part, the Mypes Unidas del Perú (MUP) union sent a statement in which they indicated that the Executive’s decision puts job creation at risk by 2025 and reduces their competitiveness compared to informal workers.
“We regret that politics prevails in the face of the reality of thousands of mypes that have not yet received the benefits of a reactivation that has not arrived,” they highlighted.
DATA
The Lima Chamber of Commerce pointed out that multifactor productivity has had a mostly negative behavior in the last five years, so there would be no justification for the increase in the RMV.
Meanwhile, ADEX stated that the decision affects MSEs that face high labor costs, but also barriers, such as access to financing, technology, training, among others.
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Alfonso Bustamante Canny: “It is a political decision”
It is difficult to describe the increase in minimum vital remuneration because, finally, it is a political decision that corresponds to the offer made by the president Dina Boluarte in his last message on July 28.
What is being done to reduce the informality labor? Unfortunately, decisions like this, where the conditions are not met, distance businesses from formality. It does not affect large companies, but small ones.
David Tuesta: “More informality can be generated”
The increase in the minimum wage can lead to high informality in Peru, which today reaches 75% of the economically active population. There are small companies that may end up laying off staff because they will not be able to afford the increase.
A growth of just over 3% should not be exaggerated and described as a great achievement. It is good to move forward, because last year we fell, but it is not enough for the country.
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