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“The increase in the minimum wage gives a very positive signal to the economy and society. When one of the main problems is a demand problem, this signal gives workers confidence and is an important signal”, Explains Caldeira Cabral in an interview with Lusa.
The economist, who was the Prime Minister of Economy in the first government of António Costa, recalls that the discussion about the increase in the minimum wage had already started when he was part of the Government and although the economic conditions are not exactly the same , has no doubt that the salary should increase.
The current moment “is different, but perhaps not so much from the time we were in late 2015 and early 2016 when there were also the same arguments” for not raising the minimum wage.
Even so, Caldeira Cabral recognizes that in 2021 the increase in the minimum wage should be more moderate than in previous years due to the current state of the economy.
Caldeira Cabral acknowledges that for some companies the minimum wage “influences their competitiveness and profitability”, but also recalls that the current crisis has affected companies very differently.
“I think this would be a year in which the increase in the minimum wage, due to economic conditions, should be more moderate than in previous years,” defends the economist, adding that the increase should be related to the evolution of the economy.
“We must design increases in the minimum wage that have to do with the evolution of the economy. What should be higher if there is a faster economic recovery, but which, eventually, should be less if the recovery of the economy is slower ”.
Caldeira Cabral recognizes that for some companies the minimum wage “influences their competitiveness and profitability”, but also recalls that the current crisis has affected companies in a very different way.
The crisis has affected very different companies in very different ways and that is why it is much more important to have strong support ”, on the one hand and, on the other, “We need to look at the Recovery Program and align our priorities with European priorities.”
And he explains what can be done to support companies: “we can use sustainability funds to finance our companies to make investments, perhaps at a loss, which will reduce their energy bill in the coming years”, for example.
This type of investment, continues the economist, can allow companies to reduce energy costs and thus make them “more competitive” and thus allow them to support “higher minimum wages”, concludes.
At the end of September, the Government began to listen to the social partners about the increase in the national minimum wage in 2021, but did not present a proposal although it maintains the objective of updating it from the current 635 euros to 750 euros at the end of the legislature.
Between 2011 and 2014 the minimum wage remained frozen at 485 euros, having subsequently increased to 505 euros in 2015, 530 euros in 2016, 557 euros in 2017, 580 euros in 2018, 600 euros in 2019 and 635 euros in 2020.
