site.btaMinimum Wage Too Far from Subsistence Minimum, Number of Working Poor Is Growing: Podkrepa CL Expert

The minimum wage is still too far from the living wage and the number of working poor is growing, according to the chief economist of the "Podkrepa" Confederation of Labour, Atanas Katsarchev. He commented on the issue during a joint forum with the Friedrich Ebert Foundation Bulgaria, which took place on Tuesday.

The living wage is a net amount necessary for living, while the minimum wage is a gross amount from which taxes and social security contributions must be deducted, Katsarchev said. Over the past four years, the minimum living wage has risen from 57% to 62% of the cost of living for 2024. However, the increase in the minimum wage relative to the cost of living is about 1.2 percentage points per year, according to the data presented by the economist. Katsarchev noted that the rate of increase is insufficient to achieve adequate minimum wages in the foreseeable future. It will take about 30 years, he said.

According to the expert, there is apathy in society towards what is happening in this country. He suggested that this is due to the political crisis. It appears that a large number of people do not know that the insurance burden for the employee is no longer 40% but is over 43%. According to him, there is a gradual transfer of employer's liability to the worker and this affects the net wage.

“We have had nearly 50% growth in the working poor in recent years, going from 8% to 11.6%, which is not good for the country,” Katsarchev told reporters before the event. According to him, this shows that despite the increase in the minimum wage, the fight against poverty is suffering a total failure. “We see from the statistics that nearly 48% of households are below the poverty line,” he added.

Regarding the negotiations on the transposition of the Adequate Minimum Wages Directive, Katsarchev said there has been no progress, although the deadline for this was November 15. He predicted more months of negotiations between the social partners. The chief economist of "Podkrepa" CL also commented that the social partners had not been presented with a draft budget for 2024, only with the tax bills.