Whether studying the issue in the classroom or conversing in a rum shop the amount and timing of the implementation of a national minimum wage generates robust discussion in any country. Pros and cons are easy to find on both sides of the contentious issue.
The Barbados government some suggest are moving like the proverbial bull in a china shop to implement a minimum wage of $8.50, up from $6.25 with security guards to get $9.25 to take effect on All Fools Day 2021. The trade unions are saying it is too low and it should be implemented without delay. Some in the private sector suggest it is too high and the date of introduction is too aggressive.
This government’s decision to increase the minimum wage is commendable and long overdue. The evidence support in the last 5 years there has been significant upward movement in the rate of inflation and the Retail Price Index supports Barbados being an expensive place to live.
The concern by parties of the dispassionate kind entering the debate is not the amount of the minimum wage being introduced but its timing. Moving from $6.25 to $8.50 is significant. Its introduction must be weighed against how the market is likely to respond. Unfortunately this is an unknown. After more than 10 years of a struggling economy many businesses are operating with depleted cashflows. Bear in mind COVID 19 would have exacerbated stress to the profit and loss of many businesses. It is easy for some to sit in the armchair and make the uninformed assumption that all businesses make money. Many operate at the margins.
On the biscuit and cheese side of the discussion, the data supports those earning at a subsistence level must be experiencing an enormous challenge. The obvious position is that a caring society must find ways to support the most vulnerable. The blogmaster will not join the politically motivated and uninformed crews by shouting the minimum wage should be hiked to $10.00 and to hell with considering the consequences. Many debating the issue are unaware this is a debate raging in many countries including the most developed.
It may be useful for the calculus used by the technicians to be made public. The majority of Barbadians will not understand it but it make help to deflate the emotional arguments that a national minimum wage amount is not determined by pulling from a hat.
It seems the majority of opinion from the private sector is that the timing is bad given the vagaries of market of the last 13 years and the consequential negative impact. From the view of trade unions and under-represented workers, now is the best time because of the current state of things.
In is against this background the government has had to make a tough decision.
The blogmaster is always amused when decisions – as in this case moving forward with the implementation of a minimum wage is made – several interest groups will make themselves heard post facto. What is the purpose of the tripartite arrangement (Social Partnership) we beat our chest again? The discord the many dissenting views must cause the public does not help to inflate confidence into the Barbados space. In a situation like this why the social partnership could not have agreed to a communique registering the different concerns after discussing government’s decision to move ahead? It seems all issues in the country have to be resolved after a predictable adversarial process. Historically this has not been the Barbados way.
Whether the government folds to the request of private sector to suspend the hike in minimum wage or not, there is a problem to solve.
How do we (society) protect the vulnerable and marginalized worker in the society at a difficult time.
How does government implement a minimum wage policy to equatable redistribute income in the society.
So far the statement on the matter from Andrew Bynoe of A1 supermarkets is one of the more sensible ones registering with the blogmaster.
I would even advocate moving to $10 an hour to somebody who works for 40 hours, so they would have a gross take-home pay of $400. However, having said that, the cost of living has to be addressed, because for businesses to be able to support the minimum wage up to $10, we have to look at the other areas of costs that affect the running of businesses…Employees would have to honour efficiency and higher productivity within the workplace…
Andrew Bynoe
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