Labour: Small Increase in Minimum Wage

The minimum hourly wage might jump to RSD 130, instead of the current RSD 121, since the Government of Serbia is prepared to support the raising of the minimum wage by splitting the difference between the unions’ requests and the employers’ propositions, Tanjug learns unofficially.

It is clear that the raising of the minimum wage will be a significant expense for the government.

The government is, however, ready for the expense, judging by the announcement made by Prime Minister Aleksandar Vucic in his expose.

He announced on the occasion that there would certainly be a raise, but didn’t specify the amount that the government supported. He pointed out that the exact number would not be announced before a social dialogue took place within the Serbian Economists Association (SEA).

– How big a raise it will be depends on the government to a great extent, but we first need to see how capable of reaching an agreement the employers and the unions are, and then we will announce our proposition – Vucic said.

The prime minister emphasized that it was nevertheless not an easy decision.

Between 230,000 and 250,000 citizens, according to some estimates, receive minimum wages, whereas the unions estimate the number at around 300,000.

The unions require the minimum hourly wage to be raised to RSD 140, whereas the employers are prepared to raise it from RSD 121 to RSD 123-124.

The unions also claim that the raising of the minimum wage will directly increase the budget income, given that taxes and contributions will be calculated based on higher wages, and that these will not be a part of the shadow economy, but fully legal.

Higher wages, as they say, will stimulate the consumption, which will in turn lead to the growth of Serbia’s gross domestic product.

The president of the Confederation of Autonomous Trade Unions of Serbia, Ljubisav Orbovic, said in his statement for Tanjug that, for those workers who earn minimum wages, the raise in the amount which Tanjug had unofficially learned about would be a quality improvement and reminded that there hadn’t been raises in the previous two years and that the difference arising from the fiscal consolidation had been repaid to workers as late as 2015.

– A bigger minimum wage means larger contributions, more money for the Pension and Disability Fund and the National Health Insurance Fund and much more purchasing power. This will be a significant step forward for the entire economy of Serbia – Orbovic says.

According to unofficial information, it is also expected that the average salary will grow in the period ahead and that it will reach about EUR 415 by the end of the year, that it will amount to around EUR 450 in the second quarter of 2017, and that it will reach, according to expectations, EUR 500 in 2018.

(RTS, Danas, 14.08.2016)

This post is also available in: Italiano

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