Following President Barack Obama’s announcement of his intention to revisit the proposal to increase the federal minimum wage to between $9 and $10 an hour starting in 2015, the Puerto Rico Manufacturers Association on Thursday raised a warning flag over the possible effects the hike could have on local companies given the island’s economic situation.
PRMA President Waleska Rivera urged Gov. Alejandro García-Padilla, the Legislation and the Department of Labor and Human Resources to identify strategies to lessen the impact to companies that would be affected by the minimum wage hike, particularly small and mid-sized businesses.
“These strategies should be attractive enough to ensure the solvency of companies and avoid layoffs that would increase the unemployment level from the current 15.2 percent,” she said.
“Our interest is that Puerto Rico increases high-value jobs value so that we can reduce the inequality gap,” she said. “Any increase in operating costs that may jeopardize retention and job growth should be studied carefully.”
Published data indicate that in the percentage of the labor force employed in the United States subject to the federal minimum wage is currently 16 percent, while Puerto Rico’s is 35 percent, said the head of the PRMA.
“We believe that to the extent that an increase in the minimum wage increases costs for other sectors, including our local suppliers, it would produce increases in the costs of manufacturing in Puerto Rico,” she said. “But beyond the increase in costs to the industry, our concern is with the island.”