Senator Diego Ibáñez and former Labor Minister Giorgio Boccardo have urged the Chilean government to broaden the discussion regarding the minimum wage, moving beyond mere numerical adjustments. In a letter published by latercera.com, the lawmakers argued that the country requires a conversation that accounts for both productivity and the rising cost of living.
The authors noted that the minimum wage has risen from $350,000 to $539,000 in recent years. According to the report by latercera.com, this 20% increase included unprecedented support for small businesses and aims to establish a standard where full-time work covers basic necessities.
Moving Toward a Living Wage
However, the authors criticized the current administration's stance, which they believe is limited to merely containing wage growth. The letter warns that ignoring the impact of inflation on basic goods, fuel, and rent results in an incomplete debate.
“A discussion about wages that ignores how inflation primarily hits those with the least is an incomplete conversation,” Ibáñez and Boccardo stated.
The senator and former officials also questioned the use of economic arguments to stall labor policy. They noted that while figures such as Nobel laureate in Economics David Card have demonstrated that minimum wage increases do not destroy jobs, current authorities are using such arguments to promote cuts and deregulation.
As an alternative, the authors propose adopting the concept of a "living wage," as defined by the International Labour Organization (ILO). They also suggest that wages should be adjusted by industry based on productivity, reviving proposals for multi-level collective bargaining projects that were previously withdrawn by the government.
Finally, the letter calls for the use of Chile's robust institutional framework to foster a debate rooted in evidence and social dialogue. The authors' goal, they say, is for minimum wage negotiations to serve as merely one step toward a more ambitious development horizon for the country.
