Consumer group says minimum wage rise won’t keep up with cost of living

Consumer campaign group Barbados Consumer Empowerment Network (BCEN) warned Friday that the minimum wage increase to $10.50 per hour will fail to protect vulnerable citizens from galloping inflation, leaving many households still struggling to meet basic needs.

BCEN acknowledged that the decision to raise the national minimum wage from June 1 is a step in the right direction for thousands of low-income workers but retained reservations.

However, executive director Maureen Holder told Barbados TODAY, “BCEN cautions the public and policymakers against the misleading suggestion that this wage increase alone will allow workers to keep pace with the rising cost of living in Barbados.”

“This wage adjustment is important, but consumers are still confronting food inflation, rising fuel prices, VAT-inclusive electricity bills, and transport costs that far outpace their earnings. Many will find that the extra dollars earned are almost immediately consumed by basic survival expenses.”

The hike will apply to full-time and part-time employees in non-specified sectors, as covered under the Minimum Wage (National and Sectoral Minimum Wage) Order: Security guards, who often have a separate (slightly higher) minimum rate and workers in industries where there is no other sector-specific wage order will also be covered.

Holder is adamant that while the wage increase may provide temporary relief for some, “it does not address the structural and persistent drivers of inflation and household hardship”.

“More importantly,” she contended, “BCEN also wants to remind the public that this measure excludes many vulnerable groups, including pensioners, the unemployed, informal sector workers, and people on fixed incomes. All of these groups are being impacted by the rising cost of living.”

The consumer activist suggested that these groups still face rising prices without any corresponding income adjustment and they will continue to struggle with rising prices and limited support.

She argued that some industries, such as domestic workers and agricultural labourers, have had separate minimum wage orders in the past.

“It is also not yet fully clear if the $10.50 per hour will override or replace those orders, or exist alongside them. The Employment (Minimum Wage) Order will clarify those specifics when finalised. Why is the government and labour unions not raising or expounding on this specific issue in greater detail to the general public?” Holder asked.

She said that unless the government intended that the one-off $300 solidarity grant will suffice for the impacted groups mentioned in lieu of any long-term income-sustainable support.

“BCEN is of the view that a true solution to our cost-of-living crisis must be holistic. We need decisive action on price regulation, consumer protection, tax relief on essentials, and stronger market oversight. Wage increases alone are not a substitute for sound economic and consumer policy,” Holder suggested.

She added: “When politicians stop making misleading comments saying things for votes, we can all settle down as a country and face the reality and see how we can truly find solutions to develop the country and assist all citizens.

“BCEN calls for honest public dialogue, free of political speech and urges the government to work in close consultation with consumer organisations to craft policies that reflect the lived realities of the average household in Barbados.”

emmanueljoseph@barbadostoday.bb