Address the plight of low wage earners
December 22, 2006
As Guyana concludes another challenging year, it is extremely distressing that a significant number of hardworking Guyanese still do not earn a decent living wage, and many think no one is making the appropriate moves to alleviate their plight.
It seems as though many of our decision-makers regard the state of the nation's poor solely as an economic issue that is inextricably linked to the perilous state of Guyana's economy. But it is much more than an economic issue; it is a matter of ensuring basic human rights. Every Guyanese has a basic right to work, and also to get fair pay for a fair day's work.
Low wage earners account for a substantial part of the country's work force. Many minimum wage workers are young adults just out of school, who are cushioned by family earnings; but many are women with children, and these women are the sole source of income in their households. Unfortunately, the earnings of lowest paid workers in Guyana put them well below the international poverty line.
By most accounts, the average earnings by low-income workers in Guyana continue to hover in the range of G$20,000 to G$30,000 per month, and many earn even less. Their ranks include some of the most important workers in Guyana --- like teachers, nurses, and members of the disciplined forces. These workers simply cannot meet their basic needs without subsidies of some kind, mainly from overseas-based relatives.
Meanwhile, the cost of the fundamental amenities of life has increased much faster than wages and salaries. Food, clothing, and particularly the cost of housing and rent, are rising steadily. Even with the government's housing drive in full flow, it is still increasingly difficult for low-income families to afford even modest accommodation. As long as this situation continues, Guyana will have to endure the disastrous social consequences of endemic poverty.
Unfortunately, many of the lowest incomes in Guyana are earned by public sector workers. The standard excuse for this is that Guyana is locked into a World Bank/IMF recipe for economic recovery that bars wage increases above the rate of inflation. If this is the price the nation has to pay to keep the donor community happy, then we must rethink our adherence to this formula, because it seems that the poorest among us are bearing the bulk of the cost.
The resolution of this issue has been delayed, and compounded by squabbling between the government and certain trade unions which represent the lowest paid workers. These unions contend that the government does not glue itself to other World Bank/IMF stipulations as rigidly as it sticks to the resolution to keep the cap on public sector wages. They claim that government has consistently contravened World Bank/IMF economic prescriptions in other areas, running up huge deficits in some areas.
As the nation enters the new year, government should seek to set a realistic ‘standard living wage,' that sets down precisely the minimum amount of money full-time workers need to meet all basic needs in Guyana's economy without government subsidies. Then government should set goals, attached to feasible time-frames, to move the national minimum wage upwards to meet that standard, which would be updated at appropriate intervals.
Government might also find it useful to mandate that businesses under contract with the government, and businesses receiving grants, subsidies, tax breaks, or any other concessions from government, must pay their employees at the level of the ‘standard living wage.'
Leaving wage negotiations up to the laws of supply and demand has not worked in the interest of Guyanese workers. In a contracted job market, workers usually have to accept whatever wages they can get, or simply remain unemployed. Since they are in a weak bargaining position, the most desperate workers accept absurdly low wages and salaries.
Setting a ‘standard living wage' and seeking to move the legal minimum wage towards it in a specific time frame is the way to go. Workers want to see purposeful, distinctly positive steps towards giving low wage earning workers a fair and living wage. Otherwise, workers will feel they are clinging to life by a thread, and turmoil will continue to plague the labour market, as well as industrial relations in Guyana.