Minimum wage shows minimum respect
George Davis, Contributor
Any good economics text will define the living wage along the lines of a 'theoretical wage level that allows the earner to afford adequate shelter, food and the other necessities of life'. A living wage should be sizable enough to ensure that rent or mortgage payments do not account for more than a third of the total.
Simply put, the living wage should ensure that the recipient is earning enough, even after paying the taxman, that they're able to afford a satisfactory standard of living. In real terms, the living-wage earner should not have to borrow from an employer to do standard things such as paying their utilities, providing lunch money for their kids, buying food, engaging in subsistence saving (especially by throwing a partner) and covering transportation costs for them and their child/children.
Danny Roberts apart, there have been few people of influence over the last 20 years who've consistently called for Government to transition to setting standards for a living wage, rather than the current prescription of legislating a minimum wage.
The chest-thumping from whichever government is in power at the moment they announce the latest increase in the minimum wage is something I find vomitous. None of our legislators of the past three decades will admit that their competency and work results are inferior to those of their counterparts in, say, Barbados or Trinidad and Tobago. Yet the conditions prevalent in those countries since 1985, based on how their politicians have done things, have allowed them to guarantee their people a minimum wage well in excess of what Jamaicans should expect under law.
In Barbados, the minimum wage as at December last year was US$3.13 per hour, US$25.04 for an eight-hour day, or US$125.02 for a 40-hour workweek.
In T&T, the minimum wage as at the end of 2014 was US$2.36 per hour, US$18.88 per eight-hour day or US$94.40 for a 40-hour work week.
In Jamaica, our minimum wage is US$1.21 per hour, US$9.68 for an eight-hour day, and US$48.40 for a 40-hour workweek! That's more than 60 per cent less than what the law mandates in Barbados and approximately 48 per cent less than in T&T!
Up north, the United States government mandates a minimum wage of US$7.25 per hour, while the minimum wage in the wider United Kingdom is US$11.84 per hour and US$13.80 per hour in London. While the advanced development of the economies of the United States and the UK easily account for the yawning gap between the hourly minimum wage in those countries and Jamaica's, how do we begin to rationalise the significant disparity with two of our CARICOM neighbours?
Women heading households
The 2011 population census tells us that the size of the average household is three persons, down from 3.5 in the previous census in 2001. Like the Central Clarendon MP Mike Henry, I doubt those numbers, but since STATIN actually did extensive field work and research, I can do no better than refer to them. The recent Survey of Living Conditions, published late last year, says the average Jamaican household is headed by a woman with at least one child in it.
If we are to accept that and apply the weekly Jamaican minimum wage of $5,600, we can begin to accept that the level below which an employer cannot pay a worker, without being carted off to jail, is barely enough to ensure comfortable hand-to-mouth living.
At the current minimum wage, we are ensuring that workers at the lower end have to borrow weekly to survive, thereby making the concept of employment unattractive to the armies of low-skilled workers who deem it better to scrounge and beg, rather than labour like those they crudely refer to as 'boasy-slaves', only to collect a pittance every weekend.
The conversation needs to change. Currently, those who three decades ago would be middle-class Jamaicans are only earning a living wage, when the living wage should really be paid to those who now get by on this at the lowest rung of the income ladder. That's evidence of an unbalanced system. Business people have been toiling in this country to find and sustain that balance. Will this Government contribute positively to the search for equilibrium?