Small businesses support minimum wage

An overwhelming number of small business operators agreed that a minimum wage was needed in Barbados, a recently released Small Business Association (SBA) survey revealed.

However, almost half of those polled said they believed the minimum wage should have been introduced after April 2022, a year after it was actually implemented.

This was contained in one of several “exploratory surveys” conducted by the SBA during its 2020-2021 financial year. The surveys were aimed at adequately addressing “several issues affecting the sector and to speak with a degree of accuracy on the impact of these matters on the operations of member-firms”.

Extracts from the Review of the Proposed Minimum Wage survey, which is contained in the recently-released SBA annual report, showed that 96 per cent of the 50 members who took part in the poll agreed that a minimum wage should be introduced.

“However, most of the 50 members who participated in the poll and agreed to the increased wage cautioned that the minimum wage should be dependent on the job being done as some would not be able to afford to employ some of their lesser skilled staff if the minimum wage became too high for ‘simple jobs’,” the report said.

When asked when they believed the minimum wage should be introduced, 44 per cent said “It should be implemented after 12 months.”

Those who suggested six months from the proposed date, accounted for 46 per cent of firms. They felt that it was time to help persons who were being taken advantage of in the workplace and who were not being given enough money to “survive”.

The report also noted that 10 per cent of firms believed the minimum wage should be introduced in seven to 12 months.

The national minimum wage of $8.50 per hour and sectoral minimum wage for security guards of $9.25 per hour, which was outlined by the Ministry of Labour and Social Partnership Relations in early February of this year in a Minimum Wage Order, took effect on April 1, 2021.

According to the SBA survey, the minimum rate that firms said they could afford to pay employees per hour ranged from “$6.90 to over $12 per hour”.

The survey showed that 21 per cent of members said they could afford $10 per hour. This was followed by 19 per cent each, who said they could afford $6.90 per hour, $7.50 per hour and $8.75 per hour.

Some 16 per cent of small businesses said at the time they could afford $8 per hour, while six per cent accounted for “other”.

The SBA said a further poll was conducted among members to gain feedback on the possible effects of a national minimum wage among three economic sectors – retail, security and cleaning firms.

The report said 17 per cent of security firms took part in the survey, 35 per cent of cleaning firms and 48 per cent of small retailers.

At the time the research more than 55 per cent of small retailers were already paying above the proposed $8.50 national minimum wage.

“When asked to state their current hourly rate, 37 per cent of small retailers stated that they paid between $10 – $11 per hour, while 18 per cent indicated that they paid between $15 – $20 per hour and another 18 per cent stated $8 – $9 per hour,” said the report.

“An additional 18 per cent of respondents reported that they paid $7 – 7.50 per hour and nine per cent paid $6.25 per hour,” it added.

The research indicated that prior to the implementation of the national minimum wage, 37 per cent of cleaning firms were paying between $8 and $8.50 per hour, 25 per cent of them were paying between $7 and $7.50, while 13 per cent reported they paid $10 per hour and another 13 per cent stated their hourly rate was $12.50.

“The other 12 per cent of participants indicated that they paid $6.50 per hour,” it added.

Meanwhile, for the security firms – the sector that prompted the swift introduction of a national minimum wage and sectoral minimum wage for security guards – when asked to state their current hourly rate at the time of the survey, 75 per cent said they paid $7 per hour.

The remaining 25 per cent said they paid $7.50 per hour.

The SBA report noted that “The majority of firms in each of the three sectors maintained an hourly work week for staff in excess of 40 hours.”
marlonmadden@barbadostoday.bb