San José, Costa Rica, since 1956
Private-sector salaries

Private sector employers propose 1.62 percent salary increase for 2015

Business leaders on Monday evening sent the National Wages Council a proposal for a 1.62 percent increase in private-sector salaries across all job categories.

“We strongly believe the next increase should be the same for all job categories, instead of separate amounts, as was approved the last time around. That type of increase causes problems,” Luis Mesalles, president of the Union of Private-Sector Chambers and Associations (UCCAEP), said.

Labor representatives last week submitted a proposal for increases ranging from 2.91-4.58 percent, depending on worker’s salary level. That calculation takes into account 1.9 percent projected inflation for next year plus 0.9 percent projected gross domestic product growth.

“We believe the employers’ proposal falls short, … and we expect the government to propose an increase closer to the reality of the cost of living,” Édgar Morales, a spokesman for the National Workers’ Union, said on Monday evening.

Labor Minister Víctor Morales will submit the government’s proposal next Monday. The same day, the National Wages Council will determine the salary increase, which will take effect on Jan. 1.

The last wage increase for 1.2 million workers in the country’s private sector was approved last July.

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Ken Morris

First of all, I’m not following this annual increase. Salaries are raised every six months, so you don’t increase them based upon annual estimates.

Second, the increase ought to be pegged to the inflation rate, excluding projected GDP growth. Workers deserve COL increases based upon inflation, but raises based upon GDP growth should frankly be merit raises only. That is, those who help GDP grow get raises, and those who don’t, don’t.

Third, as for the issue of across the board percentage raises vs. higher raises for lower paid workers and lower raises for higher paid workers, I actually prefer the variable wage increase, since that helps reduce the excessive discrepancies in pay among different job classes. However, I rather agree with the other post that wanted to do away with the multiple minimum wages for different job classes. This gets bureaucratic, cumbersome, and unjust very fast. I guess if the job classes are going to persist, I’ll go with graduated raises, but it strikes me as an overly crude way to enhance justice.

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What would you expect from a socialistic system?

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What do I expect about a Costa Rican economic article?
I expect only Yankee imperialists to comment!
And I was not disappointed!

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Tarn J. Yost

They got another thing coming if they think inflation will only be 1.9% next year. The avalanche is coming. Also the fact they have a minimum wage based on your profession is downright silly. How about salary based on performance/experience?

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Susan Fletcher

I don’t understand economics enough to figure it all out. With tax increases, prices go up. When prices go up salaries fall. So for every increase in taxes salaries have to go up. When that happens. Benefits cost more too. Then prices have to go up to cover the costs of social benefits. Again salaries suffer. Where is the benefit to raising taxes? Who benefits? Not the wage earner. Not the private businesses. Not the growers, nor the distributors.
It is definity outside of logic. Higher taxes appear to benefit only to creat more Government. Higher taxes make the middle class poorer and the poor drop off the charts. Higher taxes means more Government jobs, office space and equipment, buildings, cars, perks and benefits, higher salaries, etc. Government management means oppression of its people.
So I have to ask why do we elect anyone who wants to perpetuate big government?

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