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The minimum wage will increase from the current BGN 610 to BGN 650 as of January 1, 2021, and the minimum hourly rate will be BGN 3.92 (for an 8-hour workday and a 5-day workweek), according to a draft decree presented by the Minister of Social Affairs, Denitsa Sacheva. for public discussion. The new amount of the monthly minimum wage will be in force for both the state administration and diplomatic posts, announced offnews.bg.
In a report to her fellow ministers and the prime minister, Sacheva wrote that “the lack of an update on the minimum wage will have a negative impact on workers’ real earnings and the ability of Bulgarian companies to successfully model business models. governance in line with development and economic prospects “.
“Economic development in 2020 is severely affected by extraordinary circumstances related to risk management due to the development of the epidemiological situation due to COVID-19 and the protection of public health. quick recovery “- writes Sacheva.
According to her, the size of the minimum wage can have a positive effect on competitiveness and living standards. It refers to data according to which the country’s average salary has increased in the last two years, respectively, by 10.5% in 2018 (BGN 1,146) and by 11.1% in 2019 (BGN 1,247). . In the first quarter of 2020 it increased by 9.0% and reached BGN 1,317. The increase was higher for the administration – by 10.6% (BGN 1,339) than in the private sector – 8.6% (BGN 1,311). In the second quarter of 2020 there is a delay. The average salary is BGN 1,337, an increase of 6.1% compared to the same quarter of 2019. Again, salaries in the state administration have increased more than in the private sector. In the first, the average salary reached 1,370 BGN (annual growth of 6.9%) and in the second, 1,326 (5.8%).
“The latest NSI data on the labor market for 2019 shows that increases in the minimum wage over the last three years have not had a negative impact on employment and unemployment and the unemployment rate has reached 4.2%”, Sacheva wrote. Data from the Employment Agency for the period 3.02.2020 – 04.10.2020, according to which the newly registered unemployed are 291,165, and those who came to work from those registered in the labor offices are 186,839.
“Increasing the minimum wage by 6.6%, from BGN 610 to BGN 650, will contribute to reducing poverty among workers, reducing inequalities in income distribution and increasing consumption of the lowest income groups in the labor market, increasing their motivation and interest in preserving employment and reducing unfair competition.
According to the 2020-2023 Convergence Program of April 2020, GDP is expected to fall 3.0% in real terms this year. The average annual decline in employment is estimated to be 2.1% and the unemployment rate is expected to increase by around 2 percentage points. compared to 2019 at 6.2%. By 2021, it is assumed that the recovery of economic activity in the country will be associated with a recovery in the number of employees to its level as of 2019, ”the report said.
Public discussion of the project lasts until November 6, after which it will be voted on by the Council of Ministers.
Sofia, Bulgaria
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