Prudence in the Readjustment of the Minimum Wage

August 21, 2020

 

(Available in Spanish)

The pandemic has destroyed millions of jobs. Those keeping their jobs see a readjustment in their wages in terms of an increase in living costs. Minimum wages should follow the same path,  that is, only readjusting due to inflation, since modifying it more will generate an increase in hiring costs. The latter is inaccessible to SMEs, given the current recession, harming the workforce. 

Additionally, it is not advisable to define multi-year readjustments now, as in 2018, because the current context dictates an uncertain economic future, making it preferable that subsequent readjustments are determined according to the conditions and perspectives exhibited by the Chilean economy at that time.