You cannot raise the minimum wage at this time where there is no growth or economic recovery, says economist

The economist of the National Council of Private Enterprise (Conep) and member of the National Minimum Wage Commission, Alfredo Dubois, revealed that at this time where there is no growth or what we had in 2019 has not recovered, it is a bit difficult to Costs for companies are raised, therefore, it is not possible to speak of a possible increase in the minimum wage in the national territory.

According to the specialist, the primary reason is that companies are not selling enough, and if it is not sold, how entrepreneurs will be able to pay their commitments.

He explained that sales have fallen by 23%, according to the General Directorate of Revenues (DGI), and the net taxable income has fallen by almost 40% in a consolidated way.

“Let us remember that in Panama 95% of the inventory of companies is made up of micro, small and somewhat medium-sized companies; And according to data from the Ministry of Commerce and Industries (MICI) and the Ministry of Economy and Finance (MEF), they have verified that 25% of micro, small and medium-sized companies did not declare in 2020, that gives us a thermometer of how it is the situation when this sector usually generates an average 45% of employment in the country. These data must be considered, especially the unemployment levels ”, he indicated.

He added that formal jobs in the private sector fell or were lost by a third, giving a figure of 571 thousand salaried people in the private sector, which is less than the 777 thousand informal because these people became unemployed and became informal. . “The relationship is 1.4 times informality above salaries or formal employees in the private sector, here we are not including those in the public sector,” he said.

Dubois stressed that the labor market is a bit more rigid, because it depends on the other services doing well in order to be able to hire.

He stressed that the economy is not in the conditions at the moment to consider increasing the minimum wage, mainly the private sector. “In times of crisis you have to work more,” he concluded.

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