Govt set to increase minimum wages

Govt set to increase minimum wages

JAKARTA (JP): Minister of Manpower Fahmi Idris is expected to
announce increases in the official minimum wages this week, a
member of his staff said yesterday, Antara reported.

Director General of Guidance and Supervision Syaufie
Syamsuddin told reporters that the increases had been decided
after consultations with representatives of workers and
employers.

Syaufie admitted official minimum wages had been eaten away by
inflation.

If they represented 92.5 percent of the minimum subsistence
level in 1997, now, after inflation, they represented a mere 65
percent, he said.

The government traditionally increases minimum wages on April
1. But because of the economic crisis affecting many companies,
the previous manpower minister, Theo Sambuaga, decided to freeze
all increases indefinitely, overruling objections from trade
unions.

The government sets different minimum wages for different
provinces in accordance with the local standards of living.

The current minimum monthly wage for a worker in the Greater
Jakarta Area is Rp 172,500 (US$11.50). Batam has the highest
minimum wage, Rp 235,000, reflecting the high cost of living
there. Yogyakarta has the lowest, Rp 106,500.

The inflation rate last year was 17 percent, while the rate
for the first five months of 1998 has already exceeded 40
percent. Economists predict inflation to reach 100 percent in all
1998. (emb)