Bulgarian Industrial Association Opposes Minimum Wage Hike Proposal

Business | September 1, 2014, Monday // 12:50| Views: | Comments: 0
Bulgaria: Bulgarian Industrial Association Opposes Minimum Wage Hike Proposal Photo by bnr.bg

The Bulgarian Industrial Association (BIA) has opposed the proposal to increase the minimum wage and the social security contributions.

BIA explains in a media statement that it firmly opposed the plans to cope with the chronic deficit in the systems of social security and health insurance through an administrative increase in the minimum insurance income.

Caretaker Minister of Labor and Social Policy Yordan Hristoskov argued several days ago that the minimum wage could be increased from BGN 340 to BGN 400 without the business sector experiencing negative impact.

Hristoskov rejected allegations that the minimum wage hike would encourage unemployment.

BIA notes that the proposed minimum wage hike substantially exceeds the threshold of 60% of the average wage in most of the administrative spheres, adding that in many municipalities characterized by low employment the percentage reaches 80%.

BIA emphasizes that the ratio stands at 43-45% in most of the EU Member States.

BIA also insists that the minimum wage hike proposal does not take into account the negligible increase in labor productivity and consumer prices, against a backdrop of an annual increase by as much as 10.5% in the average wage in 2013.

BIA points out the lack of reforms in both healthcare and social security legislation.

The Association declares that it expects a realistic approach to the matter on the part of the caretaker government, as well as well-coordinated activities aimed at overcoming short-term challenges in the business environment, employment and financial stability.

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Tags: minimum wage, Bulgarian Industrial Association, BIA, caretaker government, Yordan Hristoskov, social security contributions
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