Conasami cuts from 260 to 215 pesos the six-year goal for the minimum wage

The National Commission for Minimum Wages (Conasami) has once again adjusted the goal of base remunerations. In the middle of this year, it was projected that at the end of the six-year term the amount could reach 260 pesos dailybut now analyze an increase so that it is in 215 pesos daily in 2024, reported Luis Felipe Munguía Corella, head of the organization.

The cut implies that the monthly general minimum wage (SMG) for most of the country would be more than 6,500 pesos, and not 7,900 pesos according to the previous calculation. With the labor and business sectors, “we are looking at how to achieve a less strong goal so that the increase does not distort the economy too much and impact prices and the smallest companies in the country,” the official explained in an interview.

Even with the cut goal, the plan is to comply with the increase offered by President Andrés Manuel López Obrador of “100% in real terms compared to the beginning of the six-year term”, when the SMG stood at 88 pesos. That is, he pondered, “discounting inflation and the loss of purchasing power, the minimum wage would double”.

In 2021, with inflation of 6%, the federal government intended to end the six-year term with a minimum wage of 226 pesos per day. In August of this year, he raised his expectations to 260 pesos. But with the last adjustment to current prices, the minimum floor that they would leave would be 214.90 pesos dailyas detailed by Luis Felipe Munguía.

Yesterday at the morning conference, President López Obrador received spokespersons for the labor and business sectors, members of the Council of Representatives of the Conasami and who together with the federal government set the annual increases.

This year the decision was unanimous: 20% more by 2023, announced Luisa María Alcalde, Secretary of Labor and Social Welfare. With this fifth increase of the current administration, the amount paid in most of the country will go from 172.87 pesos per day to 207.44 pesos as of January 1. That represents an additional 1,052 pesos per month.

The minimum wage for the Northern Border Free Zone (ZLFN) will rise from 260 to 312 pesos per day, that is, an increase of 1,584 pesos each month. From 2018 to the increase by 2023, “we will have recovered the 90% of purchasing power”, highlighted the secretary Luisa María Alcalde. The benefit, she said, is for more than 6.4 million workers.

Approaches the line of well-being, but does not cross it

Starting from the base of 207 pesos a day, the president of Conasami pointed out, “we only need to increase the minimum wage 10% in real terms. Plus what is presented of inflation in 2023 and 2024, because we are going to put it together so that at the end of the six-year term the minimum wage is double compared to that of 2018 ”.

However, it is possible that with the 215 pesos for 2024 working people will not reach the wellness line established by the National Council for the Evaluation of Social Development Policy (Coneval).

Said parameter is made up of the cost of a food basket and a non-food basket, and technically divides the population in poverty and the one that is not in that condition. But it is possible that those who cross the line are vulnerable due to some type of social deprivation.

Luis Munguía explained that the next adjustment will depend on inflation, “if it is very high, it will probably not be possible to reach 100%” of the well-being line, they would barely touch 1.9 or 1.8 of the baskets. “There are still several factors between now and 2024, but the inflationary one is the one that matters the most now and in the coming years.”

Despite the fact that 2022 will end with an inflation rate of more than 8%, the negotiations for the 2023 salary increase went well, “there was no strong disagreement between the sectors. Obviously it was a month’s worth of work, because the proposal from the business sector was 15% more and the worker sector as a whole asked for 25%”, he narrated.

“So there was work on the part of the government to reach a consensus.” It seemed simple, the midpoint was 20%, “But it was debated for several days.”

It could not be as high as 25% because it “could cause inflation expectations. Psychologically it affects, not because the cost is high, but because the number 25 could sound like it was and impact the speculative market”. That was understood by the workers, “he was quite aware when he was told of the possible effect that it can have on companies.”

But neither could the increase be as low as the 15% proposed by the business sector. “It seemed insufficient to us because, although inflation is probably going to close at 8.3 or 8.4% this year, the price of commodities like the tortilla or the egg will end up in 16% more. So, although his proposal was above general inflation, it was not so for basic products ”.

With all this, the business sector “was very responsible in assuming the costs that pay fair wages for the workers. They are also aware that it benefits them, because with higher income they consume more”, she added.

“This is very good news for the workers of Mexico. The increase in the minimum wage is one of the great achievements of this government that not only benefits those who earn it, but also all the workers who have received constant increases” as a result of the impetus given by these wages from below.