General and agricultural minimum wage increases on track
The general minimum wage increase is on its way. After the soap opera between the Moroccan employers’ association (CGEM) and the Government that has enlivened the last few weeks, the draft decree were supposed to be discussed on Thursday September 21, at the Government Council meeting.
The two parties took stock of the commitments made, and the employers’ association, being» serene and at ease «, spoke of «constructive dialogue « and brushed aside any opposition to raising the general minimum wage.
The new 5% increase will be granted in accordance with the social agreement of April 2022. Its application is subject to publication of the implementing decree, which may be issued quickly or delayed. « Many companies, particularly large ones, are used to paying salaries on the 28th or 29th day of the month. Deadlines are likely to be tight. They could apply the increase from next month onwards and make the necessary adjustments «, say HR managers contacted by L’Economiste.
This new increase should result in an hourly wage of 16.30 dirhams (USD 1.63), compared with the current 15.55 dirhams (USD 1.55) in industry, commerce, and services. The monthly general minimum wage will rise to 3,111.39 Dirhams (USD 311.14) gross, compared with 2,990.05 Dirhams (USD 299) at present.
Similarly, the legal minimum wage for a day’s work in agriculture will be 88.58 Dirhams, compared with 84.37 Dirhams. It will stand at 2,303.08 Dirhams gross. In this sector, a first increase of 10% was agreed in September 2022, and a second of 5% is planned for this year. The medium-term goal is to bring the general minimum wage into line with the agricultural minimum wage, which will require annual increases in the agricultural minimum wage. This is a complex sector, characterized by seasonal employment, caregivers, unpaid work, and other factors.
This increase in the general (SMIG) and agricultural (SMAG) minimum wage is eagerly awaited by a large number of employees. It will enable us to make up relatively for the rise in prices. The consumer price index rose by 4.9% in July, driven by an 11.7% increase in the food index and a 0.4% increase in the non-food index. For non-food products, variations ranged from a 7% fall for «Transport» to a 5.8% rise for «Restaurants and hotels».
On the business side, this increase in the general minimum wage could weigh on production costs, with a direct impact on competitiveness. The Centre Marocain de Conjoncture (Moroccan business conditions studies center , CMC) think tank had pointed out that the imperatives of supporting growth, protecting jobs, boosting productivity, and improving competitiveness are important factors to consider in such decisions.
In any case, the impact of this revaluation differs from one line of business to another, and depends on production technology, labor intensity, and the proportion of workers paid the minimum wage.
Khadija MASMOUDI
