Minimum wage must balance risk

Due to the overwhelming inequality in our society, this week’s proposal by the National Minimum Wage Commission for a consumer price index (CPI) plus 1% increase, is a step in the right direction.

While we still have a long way to go to improving the quality of living for the majority of our working class, an increase from R19.09 to R23 an hour will go a small way in helping, in particular, the hundreds of thousands of our domestic workers.

It’s hoped government will ratify the proposal from 1 March, 2022.

Cosatu parliament coordinator Matthew Parks said: “In effect, domestic workers have gone from earning R15 an hour three years ago to earning R23 an hour. That’s really a significant increase and contributes to help uplift the standard of living.”

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Many will argue that picking and choosing which sectors of employees must get an above CPI increase is not fair, particularly when you take into account how Covid has affected so many businesses over the last 20 months.

Some sectors, both private and public, are still dealing with salary knocks due to the pandemic, so an increase in wages will, in turn, hit them hard. Also, on the back of our ever-increasing unemployment rate, will the pay adjustment lead to further job losses?

Economist and trend analyst Bronwyn Williams poses a valid question when she asks: “Increases on minimum wages do have an impact on the employment levels in society. We have to ask ourselves as society if that is a trade-off worth taking on because there is obviously massive inequality in our economy?”

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She added: “The catch is, of course, if wage increases are forced onto a sector where you already have cash-strapped consumers who, perhaps, think having a domestic worker is becoming a luxury.”

Looking at the bigger picture, we have to find ways to keep increasing the minimum wage but at the same time, not risking further job losses. Putting food on the table has become a daily nightmare for so many.