As you may recall, I recently made some additions to the Labor section of the Wikipedia page on the economy of Venezuela. I shared my updates with you in my
June 16th post. Below, I am including my contribution once again for your convenience.
Labor disputes have continued to increase since the financial crisis in 2008. With inflation at over 56% and widespread shortages of basic goods, even the government has admitted that productivity is low. According to The World Economic Forum, Venezuela is ranked as 134th of the 148 countries for economic competitiveness. Many in the private sector attribute these findings to the inflexible labor market.
In recent years, a barrage of pro-worker decrees have been passed. The most significant could be the 2012 labor laws known as the LOTTT. These laws included the virtual ban on dismissal, shorter work week, improved holidays, and enhanced maternity benefits. The LOTTT offers job security to most workers after the first month. Employers have reported an absenteeism rate of up to 40% which they blame on the leniency of these labor laws. As expected, employers have been less willing to recruit.
On November 17, 2014, the President of the Republic issued a decree to increase the minimum salary for all workers by 15%. The decree became effective on December 1, 2014.
There have been no changes or additions made to my contributions. Nonetheless, since my original post, I did come across some additional information and decided to make further updates.
On April 28, 2015, as part of the May Day celebrations in honor of workers' day, president Nicolas Maduro announced an across-the-board increase of the minimum wage, which will rise by 20% as of May 1st and by 10% at the start of June.
This addition reflects the most recent wage increases set forth by the government. Unfortunately, these increases have not been enough to alleviate the pain of the working class in Venezuela.
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