Unpredictable Minimum Wages Kill Jobs

The cost of labor is critical for textile companies which migrate from Honduras to El Salvador and Nicaragua, where wages are lower.

Wednesday, March 9, 2011

Daniel Facussé, president of the Honduran Manufacturers Association (AHM), states that 16 textile companies have moved their operations from Honduras to Nicaragua and El Salvador since the end of 2008.

For the Businessman, the main reason is the difference in wages between Honduras and its neighbors. Facusse explains that "Nicaragua has the lowest wages in Central America; it is half the salary of Honduras, which pays the highest wages of the region."

Among advantages offered by Nicaragua in terms of labor, it states the stability and predictability of policies which set minimum wages, offered also by El Salvador.

More on this topic

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September 2013

Between January and July 2013 there were 159,866 new labor contracts, marking a growth of 14%.

The data was provided by the Ministry of Labor and Workforce Development.

"37% of the contracts were permenant, 29% temporary and the rest were for projects that had a fixed completion date," reported Prensa.com.

FDI in Costa Rica during 2009

January 2010

29 new foreign investment projects in high technology services, medical devices and advanced manufacturing.

The Costa Rican Investment Promotion Agency (CINDE), indicated that 29 new foreign investment projects that arrived in the country in the high technology services sector, medical devices and advanced manufacturing, in conjunction with the companies already installed, generated 5,730 new jobs and US $304.6 million during 2009.

Labor shortages boost wages in region

April 2008

Competition is heating up in Central America for labor in sectors such as agriculture, construction and domestic service.

Wages are increasing rapidly because of the shortage in Panama, Costa Rica and El Salvador.
In Panama and Costa Rica alone, some 300,000 workers need to be imported for harvests and the modernization of the Panama Canal, according to the World Migration Organization.

Manpower holds regional employment fair

April 2008

The human resources consulting firm Manpower will hold its first regional employment fair April 24-26. It hopes to fill 400 vacancies for technicians and professionals for its local and international clients.

Participating countries include Costa Rica, Guatemala, El Salvador, Honduras, Nicaragua, Panama and the Dominican Republica. The fair will take place simultaneously in the Manpower offices of the seven countries.

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