Gustavo Petro's government increases minimum wage by 12%
Ultimas NoticiasDec 30, 2023
Colombia's Labor Minister Gloria Inés Ramírez has announced that the minimum wage in the country will rise by 12%, or 140K pesos ($36.63), to 1.3M pesos ($340) per month. In 2023, the minimum wage was increased by 16%.
The hike comes after workers, employers, and government failed to reach an agreement despite month-long negotiations. The government accepted the union's proposal despite opposition from employers a day before the legal deadline to set the minimum wage was set to expire.
Because inflation is expected to further trend down in Colombia and unemployment has fallen to 9%, this wage increase — as well as a 15% raise in monthly transportation allowance — will help millions of vulnerable citizens nationwide boost their purchasing power.
It's a popular misconception that increasing the minimum wage will benefit low-skilled workers. As this move forces the price of labor up, it ultimately reduces formal job opportunities. Rather than imposing the minimum wage in a nation like Colombia, politicians should be focused on human capital to boost productivity.
There's a 17% chance that Colombia will experience a civil war before 2036, according to the Metaculus prediction community.