City Councilors push for minimum wage rise of 13%

JAKARTA (JP): City councilors have urged the municipality to push ahead with plans to increase the local minimum wage by 13 percent despite the nation's monetary woes.

Councilors Tadjus Sobirin and Djonharro from the ruling Golkar faction said Wednesday that realizing the plan could help casual workers deal with rising costs.

They suggested the city administration make a tripartite arrangement with employers and workers to discuss the companies' ability and the correct time to increase wages.

"We realize that it's probably not the right time now for employers to increase wages but workers need more money. Everything is expensive now. How can workers survive on such small wages?" Tadjus, head of the Golkar faction, said.

According to the Ministry of Manpower's city office, the minimum wage in Jakarta is Rp 172,500 (US$28.30) per month. It covers only 96 percent of everyday needs as set out in the ministry standard.

The calculation takes into consideration the cost of food and drinks, housing, clothing and basic expenses such as transportation, recreation, medicine and education.

The 13-percent increase is expected to meet these basic needs, the councilors said.

"I believe -- despite the ongoing crisis -- the municipality and city employers can come to a good arrangement for the workers," Djonharro said.

"If 13 percent is too much, for instance, the municipality could accept a smaller hike. I strongly suggest the plan proceed because workers who receive a small wage are really in a jam right now."

Some employers have previously expressed their objection to the plan to boost workers' wages, saying it was almost impossible due to the economic crisis.

Djafar Tirtosentono, chairman of the Thousand Islands Marine Tourism association, said it had been difficult to stay afloat even in the tourist industry.

"Every year, especially in the peak holiday season like now, we always have a full house. But right now we only have 10 percent of the usual number of visitors. We can't possibly afford the raise," Djafar said.

"Basically I agree with the proposal but I don't think this is the right time to increase wages. It's just impossible to do it because we have to focus on staying afloat."

Most businesses, especially tourism, have been the hardest hit by the rupiah's free fall, he said.

"Since last October, a large percentage of holiday reservations have been canceled. People usually pull out when the conversion rates are high.

"Wait for at least another six months. If the economic situation is improving then we can talk about a raise. We have to be patient."

Businessman Ferdy M. Jauhari, director of a cookie company, said that even though it was high "cookie" season, it was difficult to give a wage raise.

"There is not one business in this city which is unaffected by the monetary crisis. So I don't think we can afford a raise. My company has already dismissed 150 workers.

"It's not that we don't want to give our workers a better income. We really are in a jam here."

Based on ministry data, 41 companies want to postpone this year's increase to the minimum wage because of their inability to pay.

But only 28 companies have been given permission because of financial hardship.

The ministry has yet to decide whether to approve proposals by three companies in South and North Jakarta to dismiss 310 workers this year. (edt)