Colombia to increase minimum wage by 12% in 2024

Colombia will increase the minimum wage by 12% in 2024, as reported today by President Gustavo Petro in a joint press conference with the Minister of Labor, Gloria Ines Ramirez. One day before the end of the legal period to set the minimum wage, there was no agreement between workers and employers, so the wage was set by presidential decree, as required by Colombian law.

Thus, as from January, the more than 2.5 million workers who receive the minimum wage will receive 1,300,000 pesos, 140,000 pesos more than this year. Additionally, the recipients of this minimum wage, who also receive a monthly transportation allowance, will now receive 162,000 pesos for this component, which means an increase of 15% over the amount received in 2023.

Unions lowered their demands

During the month-long negotiations at the tripartite table between workers, management and government, the workers’ representatives, citing historical debts, demanded a considerable increase of 18%, which was flatly rejected by management. Finally, today they lowered their demand to 12%, an amount which was not accepted by management either.

After the meeting, the Unitary National Command formed by the CUT, CGT and CTC trade union centers and the Confederations of Pensioners CDP and CPC, regretted no agreement having been reached in the meetings of the National Concertation Commission to seek an increase in the minimum wage for the year 2024, and asked the government to take into account their considerations when deciding the increase, which was accepted by the public representatives.

In this way, and only 24 hours before the end of the legal time to announce the resolution to the country, the government imposed the increase by decree, accepting the unions’ final request of 12%.

More than 2 points above inflation

With this increase, minimum wages will grow a little more than 2 points above the country’s annual inflation rate, which for November was 10.15%, a percentage that is still expected to be reduced by a few tenths of a percentage point by December 31.

Thus, this minimum wage will have increased by 28% in two years. With inflation in the last 24 months of approximately 22.8%, workers who adjust to this rate will have achieved a benefit of more than 5%.

The country has been waiting for this news for a long time, due to the enormous impact it has on the population, especially after a hard year economically speaking: high inflation, which is slowly decreasing, and credit interest rates that until a few days ago had not started to fall, and which remain at 13% at the end of the year.

The context, therefore, is one of economic stagnation, with a significant rise in prices, especially of basic products such as food. Nevertheless, according to data released yesterday, unemployment in Colombia is low, standing at 9% for November, something that has not been seen for six years.