In Guatemala people are now suffering from the "labor agreements", which come from the same strain of virus as the "Collective agreements" which have made the State Costa Rica sick, distorting the labor market and generating inequality.
The editorial "Harmfulness of labor agreements in the public sector", published today on Elperiodico.com.gt, might have been written some years ago to describe Costa Rica. Guatemala still appears to have a chance to react to the disease, with proper medication. In Costa Rica, however, the disease is so widespread that major surgery is needed which today does not seem feasible, and the only thing left is to wait for the inevitable final crisis.
In a context of high unemployment and informal work any increase in the amount of the minimum wage produces more unemployment, more informality, and consequently, more poverty and inequality.
In Costa Rica, the latest numbers released by the National Statistics Institute (INEC) located unemployment during the first quarter of 2015 at 10.1%. If you add those who are not unemployed but who have informal jobs, which is 45.3% of the working population, you can tell why almost half of the population in Costa Rica who wants to work do not get better incomes if the minimum wage is increased.
The closure of the 29 restaurants has left, not only unmet demand in the fast food market in high consumption areas, but also well-qualified staff.
An article in Elfinancierocr.com is an accurate analysis of the wakeup call for the fast-food market of Costa Rica, represented by the closure of operations of a franchise which has been operating since 1990.
Before negotiating a new amount for the minimum wage in Panama, the Chamber of Commerce, Industries and Agriculture notes that "those who strive more should receive more."
From a statement issued by the Chamber of Commerce, Industries and Agriculture (CCIAP):
With the establishment of a table for revision of the minimum wage, involving business associations and workers in mediation with the government, a process has been started that we hope will be carried out in accordance with the spirit for which this provision was set.
The increasing speed and ease of direct access to the information needed for decision-making, is drastically reducing the number of middle managers who used to be hired to provide them.
In companies of the last century when a sales manager needed information about last year's sales in order to take a relevant decision, he or she had to contact their assistant manager, who was responsible for collecting information and presenting it to the director. Nowadays, the direct and easy access to all information concerning day-to-day business allows the same director to touch a screen, get the information and make the decision, reducing costs and saving time.
The recently adopted legislation requires companies to make a tax contribution equivalent to 4% of the monthly salary of each employee on their payroll.
In addition to the monthly contribution of 4%, the new Framework Law of Social Protection System for a Better Life states that "...Employers must pay into the respective sub-account of a worker's labor reserve until the respective account reaches an amount equal to the amount of the unemployment benefit provided for in Articles 102 and 120 A of the Labour Code, at its highest level. The employer must renew contributions for workers who when their ordinary salaries increase are entitled to receive a higher amount for severance pay. "
"Civil service careers are influenced by arbitrariness, politicization, patronage, the search for private profit and patronage criteria and with posts being filling up with public servants who do not have the sufficient merits to perform their functions."
From a statement issued by the Salvadoran Foundation for Development (FUSADES), regarding the report The Civil Service and Patronage:
In Costa Rica civil servants earn on average 150% more than workers in the private sector, which contributes decisively to the growth of inequality and lowers the overall competitiveness of human resources.
The emigration of six out of seven Salvadorans who have studied for 12 years or more is removing a vital resource for economic performance, preventing improvements to labor productivity in the country.
Up until 2000, 85% of high school and college graduates with twelve or more years of education had migrated, reveals the study 'Measuring the international mobility of skilled workers'.
The government has announced that from January 1 there will be an increase of 4% in the legal minimum wage in the productive sectors.
The rise corresponding to this year, 2015, is part of an agreement reached in 2013 and modifies the table for minimum wages, increasing the minimum monthly wages for workers in different sectors by 4%.
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