MINIMUM WAGE TO GROW ALONG WITH THE COST OF LIVING

Interview of President of CCM, PhD Zivko Mitrevski
Newspaper Nova Makedonija, January 14, 2014

CCM DEMANDS CHANGES IN THE LAW ON MINIMUM WAGE

Change in the calculation of the minimum wage in proportion to the cost of life is demanded by the Federation of Trade Unions of Macedonia. The current method of calculation does not include inflation and rising commodity prices which according to trade unionists could adversely affect the standard of citizens who receive minimum wage.

• The minimum wage should be adjusted regularly to maintain the purchasing power of the workers concerned especially in terms of price increases, to avoid major economic shocks. In setting the minimum wage we must keep in mind that the consumer price index (CPI) reflects the prices for the average consumer. During the rapid increase in food prices the CPI underestimated the increase in prices of goods and services that are bought minimum wage recipients - states PhD Zivko Mitrevski, President of the Federation of Trade Unions of Macedonia (CCM).

From the union add that in calculating the minimum wage other elements should be included such as the poverty line. According to the current law the minimum wage is calculated as a percentage of the average gross salary in Macedonia (39.6 %) and amounts 8.050 MKD or 131 Euro.

• This type of calculation proves insufficient because does not allow the desired increase in the minimum wage. Instead of the minimum wage to monitor the rising prices and cost of living every year it is the opposite. The minimum wage devalues and reduces the purchasing power of employees who receive this payment. We lack criteria of adjustment which European countries and countries in the region have- emphasize from the union.

Growth of average wages

• The Law on Minimum Wage has been applied for two years and the union does not exclude the possibility that certain companies do not respect it. There are claims that there are employers who want to circumvent the law and that are why we need to strengthen the capacity of the labor inspection. With the law we have increased the average wages in the sectors with the lowest incomes and with the collective agreements we have established higher minimum wages - added Mitrevski.

Unionists consider that increasing the minimum wage is possible if we take into account recent indicators of economic trends in the country. The growth of gross domestic product in the three quarters of last year with 2.9, 3.9 and 3.3 percent, according to the unions, suggests that the country is slowly emerging from the economic crisis.

• Even in times of greatest crisis, despite the reduction in real average wages, half of the countries have raised the minimum wage in 2009, including Russia. The goal is to prevent a reduction in the purchasing power of the lowest paid workers during the crisis which contributes to the output of it. Thus CCM together with the social partners needs to make some changes in the law – state from the union. 

Greater purchasing power

Reports of the State Statistical Office show growth in several industrial areas in recent months. Industrial production in January- November 2013 compared to the same period in 2012 amounts to 2.6 percent and an increase in the number of workers in the industry has been registered. These economic indicators, as well as the announcements of increased foreign direct investment and unemployment are some of the reasons why the union believes there is room for an increase in the minimum wage.

• We must begin to think and fight wages not to lose their value. Wage growth not to be result of productivity but earnings to grow along with the rising prices and cost of living. It should be noted that higher wages and improved purchasing power of the population contribute to the growth of domestic consumption and the economy in the state - added Mitrevski.

Businessmen have been also seeking higher minimum wage

Representatives of the Economic Chamber of North-West Macedonia from the Ministry of Labour and Social Policy before 2013 demanded the minimum wage of 8.050 MKD to increase to 20,000 MKD.

• We demand approaching to the real needs of citizens. The minimum wage is so low that with it can not be survived. It is time to do something in this field because the minimum wage gives unrealistic picture of the situation. If we are realistic enough we will admit that no one can survive on minimum wage - said President of the Chamber, Menderes Kuqi. The position is shared by all members of the chamber and the president indicated that 20.000 MKD is a salary already paid to employees.

Minimum wage/ EUR

• Macedonia 131€
• Albania 147€
• Bulgaria 154€
• Bosnia and Herzegovina 163€
• Serbia 184€
• Croatia 395€
• Slovenia 592€
• Greece 443€