The Ministry of Labor and Social Policy proposes that the minimum wage from January 1 next year be 1213 leva or 620.20 euros. The draft decree of the Council of Ministers has already been published for public discussion. The deadline for expressing opinions on it is September 25.
"We have all the social and economic prerequisites and reasons to support such growth", the chief economist of the Confederation of Bulgarian Trade Unions, Lyuboslav Kostov, told the Bulgarian National Radio.
"There is nothing new. The Minister of Labor and the Council of Ministers, through the draft decree that they will now adopt, comply with the law, which states that the minimum wage for the next year is determined based on 50% of the average for the previous 4 quarters. Simple mathematics shows that it should be 1,213 leva. We support such growth - this is about 12.3%. That is the growth of the average wage in the second quarter of this year. Accordingly, this growth is acceptable and corresponds to the market dynamics that are happening with the average wage. Secondly, for the 12th or 13th consecutive quarter, we can see that the unemployment rate is at a record low, employment is rising, albeit slightly, and consumption continues to be the main driver of growth," he explained.
Lyuboslav Kostov cited data from national statistics, according to which about 460-470 thousand people work on a minimum wage. However, he reminded that many other payments, including social ones, depend on the minimum wage.
"The minimum wage includes people in the labor market. It brightens, thus raising the minimum social income. Undeclared employment in Bulgaria is a large share - employers massively provide less money and put the rest in an envelope. The higher the minimum wage, the more money there is in the form of social security contributions and taxes," the economist emphasized.
However, a 1,213 leva minimum wage does not solve the issue of the working poor, Kostov was categorical, but added that we are still moving in the right direction.
In his words, this minimum wage places us at the bottom of the entire EU:
"We are at the bottom not only in the eurozone, but Bulgaria has the lowest minimum wage, even after this increase, in the entire EU. Not to mention that we are comparing ourselves to countries like Albania, Serbia and North Macedonia, where the difference between their and our minimum wage is no more than 10-15 euros. We still have a lot to work on. We are entering the club of the rich. Income policy must be made a priority and horizontal policies must be targeted. Even after this increase of 136 leva, Bulgaria will unfortunately be at the bottom in terms of minimum wage. In the other member states where there are minimum wages - a total of 22 in number - there is a non-taxable minimum everywhere, only in Bulgaria there is none".
We are entering the eurozone and people expect, against the backdrop of rising prices, adequate incomes, the economist is categorical.