On May 14, the Myanmar government announced that the 8-hour basic salary per day will be increased from the original 3,600 kyat (about 16.7 yuan) to 4,800 kyat (about 22.5 yuan), an increase of 1/3, effective on the day, but it is not applicable to small or family businesses employed less than 10 people.
legislation stipulates that basic wages will be reorganized every two years for Myanmar's labor market reform narrows the gap between the rich and the poor and the wage ratio between men and women
Although Myanmar has not yet joined the ILO's minimum wage convention, its formal implementation of the basic wage system from September 2015 is the initial result of the country's labor market reform.
Myanmar Basic Wage Law stipulates that the state must promulgate new basic wages every two years. Media reports said: This wage increase will be the first time since the minimum wage was launched in Myanmar in September 2015. Labor representatives hope to raise it to a daily salary of 5,600 Myanmar kyat, and the corporate side agreed to 4,000 Myanmar kyat. Therefore, in the past year, the National Basic Wage Development Committee, composed of the government, employers and labor parties, has conducted multiple national consultations, and reached a resolution to adjust the first basic wage increase to the maximum extent to meet the needs of all parties. Finally, the government decided to set the daily new order of 4,800 Myanmar Kjet.
Research by the International Labor Organization shows that Myanmar's basic wage system has indeed achieved some results in reducing poverty and inequality over the past two years. From a gender perspective, the gap in average wages between men and women fell from 25% in 2015 to 12% in 2017.
Of course, there are still huge challenges in relevant laws and regulations, including urban-rural gaps and limited resources in the supervision system. While the government has begun regular labor surveys, more immediate and detailed data is still needed to analyze trends. Due to time constraints, the Commission has not yet been able to thoroughly investigate the living costs of workers in various regions, which has resulted in the fact that the survey results cannot accurately reflect the actual living expenses of workers.
Cost increases companies hope that the government will assist in dealing with the fact that Myanmar’s salary is still far lower than neighboring countries
When the basic salary rises, some investors will adopt the method of reducing other allowances and benefits to achieve the purpose of maintaining or reducing labor costs in disguise. In recent years, Myanmar has used clothing manufacturing and food processing as its main export industries. After the policy is implemented, the Myanmar Garment Manufacturers Association stated that after raising the minimum wage, enterprises will take measures such as reducing overtime pay. The Myanmar Daily reported that some employers also warned that the basic salary of 4,800 Myanmar Kyat would force Myanmar small and medium-sized enterprises to close, and most of the local enterprises were composed of small and medium-sized enterprises.
The chairman of the Myanmar Clothing Manufacturers Association said that the government should assist enterprises in upgrading, such as improving infrastructure, providing loans for enterprises to update machines, reducing red tape, assisting in training workers, and improving productivity. He believes that "these will help the industry cope with the increase in minimum wages."
Local workers hope that after the salary increases, the prices of basic daily necessities will not rise accordingly, otherwise there will be no difference between whether the salary increases or not.
The report also pointed out that despite the increase in the minimum wage, Myanmar's minimum wage still lags behind Cambodia , Lao and Vietnam. Philippines , like Myanmar, has a minimum monthly salary of about US$80.28 (about NTD2,390), far lower than Laos 110.34 (about NTD3,285), Cambodia 140 (NTD4,168), and Vietnam 147.47 (NTD4,391).
To achieve the UN's 2030 sustainable development goals, the government should invest in establishing a complete regulatory mechanism to track the application and impact of relevant systems and provide a data basis for future review and adjustments; and strengthen social welfare, such as building social housing, to alleviate the pressure on labor caused by rising living costs.
But for now, I still need to express my affirmation of Myanmar's efforts to promote employment, strengthen social security, and safeguard the basic rights and interests of workers; and the threshold for the joint negotiation of basic wages by the government, enterprises and guilds also symbolizes that Myanmar is establishing a new democratic culture.
