Minimum wage readjustment: check the values ​​in other 40 countries – 02/17/2023 – Market

In May, the minimum wage in Brazil will increase from R$1,302 to R$1,320. It is an insufficient amount to buy two basic baskets in 11 Brazilian capitals in January 2023, according to a survey by Dieese (Interunion Department of Statistics and Socioeconomic Studies).

In September last year, the same Dieese also calculated that the base value to support a family of four in the country would be R$ 6,298.91—it is an account that considers items such as food, education, hygiene, leisure, housing, health , clothing, transportation and even social security.

And how is the minimum wage in other countries?

First, it is important to point out that it is difficult to make a comparison between different locations at nominal values.

It is a more complex picture, with several factors to be taken into account – such as purchasing power in each country.

“The first item for comparison is purchasing power parity. Then you could check the minimum in relation to the country’s average or median salary. In the European Social Charter the minimum is between 50%-60% of the country’s salary”, says Carlos Alberto Ramos, professor at the Department of Economics at the University of Brasília (UnB).

Naercio Menezes Filho, economist and professor at Insper, says that “the ideal is to compare the minimum wage with the average wage [que está em R$ 2.700 no Brasil]. By this metric, Brazil is not bad. You can increase a little more, but be careful not to cause inflation and increase public spending a lot”.

The Brazilian minimum wage, when converted into dollars, is US$ 250. In Latin America, the highest amount paid in the region is in Costa Rica (US$ 603).

See a survey of the Latin American minimums in 2023 made by the Bloomberg Línea website:

• Argentine: US$ 189
• Bolivia: US$ 325
• Chile: $475
• Colombia: $242
• Costa Rica: $603
• Ecuador: $450
• El Salvador: US$365
• Guatemala: $403
• Honduras: $316
• Mexico: $325
• Panama: $326
• Paraguay: US$ 349
• Turkey: $269
• Uruguay: US$540
• Venezuela: $8

According to Bloomberg Línea, on average the readjustment in the region was 8% among countries that have already defined their increases.

This is an important point because inflation, all over the world, has been a concern with the erosion it causes on wages in general.

In South Africa, Brazil’s partner in the Brics, the projection for 2023 is that the minimum will be approximately US$ 210.

In Europe, the highest value of the minimum is in the small Luxembourg, with the equivalent of US$ 2,545.

See below the compilation of Eurofound, an agency of the European Union, with the values ​​for 2023:

• Germany: $2,111
• Belgium: $2,084
• Bulgaria: $425
• Croatia: $746
• Cyprus: $943
• Slovakia: $746
• Slovenia: $1,390
• Spain: $1,342
• Estonia: $772
• France: $1,821
• Greece: $886
• Netherlands: $2,061
• Hungary: $617
• Ireland: $2,035
• Latvia: $660
• Lithuania: $895
• Luxembourg: $2,545
• Malta: $895
• Poland: $795
• Portugal: US$945
• Romania: $646
• Czech Republic: $764

Austria, Denmark, Finland, Italy and Sweden do not appear on the list because they do not have a minimum wage defined by law.

United States and China

In the US, the federal rate is $7.25 an hour or $1,160 a month. It’s the same floor since 2009. Protests take place periodically demanding that this value be increased to US$ 15/hour.

Many US states (and cities too) adopt their own minimum. Washington State, for example, offers the highest rate at $15.74 per hour. In the capital of the country, the municipality of Washington will set the salary in the year 2023 at US$ 16.10 an hour.

China also has a system that varies by region. The Chinese government’s Ministry of Human Resources and Social Security released figures for each of the 31 provinces at the beginning of the year.

Shanghai has the highest value, with US$ 400 per month and, at the bottom of the table, is the province of Lianongue, with US$ 224 per month.

Local governments define these values ​​taking into account points such as the cost of living, economic development in the region, housing expenses, among others.

This text was originally published here.