Mexican business community endorses 20% increase in minimum wage

By: MRT Desk

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Mexican business community endorses 20% increase in minimum wage

The Mexican Business Coordinating Council (CCE) announced on Monday that it endorses the 20% increase in the minimum wage proposed by President Andrés Manuel López Obrador although the private sector had suggested a smaller increase.

“We are over 20%,” said Francisco Cervantes, president of the CCE, to EFE’s express question during a dialogue with the media in Mexico City.

The statements of the leader of the dome of the private sector occur hours after López Obrador said that “there is willingness” of all sectors to increase by 20% the minimum wage by 2023, a decision that would be announced next Thursday.

The National Minimum Wage Commission (Conasami) is debating next year’s increase amid the highest general inflation in two decades, which reached an annual rate of 8.7% in September, the highest rate since 2000.

Although the Employers’ Confederation of the Mexican Republic (Coparmex) had asked for an increase of 15%, the president of the CCE said that the unions were asking for a higher increase, so they are “reaching an average.”

“It is not that we support it (20%), what we want to avoid is that the salary goes down the stairs and inflation goes down the elevator, so we have to balance this very well,” argued Cervantes, who represents 12 business organizations that account for 80% of the Mexican economy.

Increasing the minimum wage has been one of the main labor policies of López Obrador, who said Monday that since his first full year of government, in 2019, it has grown by 62% in real terms and in the municipalities of the border with the United States the increase has doubled.

Before López Obrador took office, there was a minimum wage of 88.36 pesos a day ($4.4) in 2018 while it is now 172.87 pesos ($8.6).

Cervantes called for “balance” for micro, small and medium-sized enterprises (MSMEs), noting that in 2023 changes such as the pension reform that requires an increase in the employer’s contribution and the vacation reform that raises the mandatory days of rest from six to 12 come into force.

“2023 is going to become a year with a very important labor agenda, and we agree, but we are asking for gradualness, in such a way that MSMEs do not weigh on them because after the pandemic it cost them a lot of work, many did not endure,” he said.

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