“The economy is growing, average wages are growing, therefore the minimum wage has to be regulated. Because MMAs are mostly given to people who don’t usually have qualifications, they don’t put pressure on the employer to increase their pay. That is why state intervention is needed and it is good that this is being done. “LNK“R. Lazutka told the television.
Although employers’ representatives are not very much in favor of such an increase in MMA, the economist believes that businesses would not feel much difference, as the country has a large shadow economy.
“It can be roughly said that MMA should make up about 50 percent. average wage, but it should also be borne in mind that the average wage in Lithuania is slightly reduced due to the prevailing shadow. People get extra income from businesses: cars, as well as a reward paid in envelopes. That is, I think, even if the minimum wage exceeds 50 percent. from the average wage, it would not be some kind of pressure on employers, companies, etc. “, – says the economist.
According to R. Lazutka, it should be noted that labor productivity in Lithuania is higher than in other European Union countries, and wages are one of the lowest. Only Romania, Bulgaria and Hungary receive even lower wages.
“We need to have a starting point from which to measure wage and productivity growth. There was a long time after the 2008 crisis, when wages practically did not rise, but labor productivity increased. Now the opposite is true, but labor productivity in Lithuania is still relatively higher compared to other countries, and wages are lower. According to salary plus taxes Lithuania is fourth from the end of the European Union: labor costs are lower and labor costs are lower only in Romania, Bulgaria and Hungary. Therefore, entrepreneurs could not even complain that working in Lithuania is too expensive for them, ”says the professor.
R. Lazutka also denies the often heard opinion that living in the province is cheaper than in the big city. The economist does not see much difference and argues that MMA should certainly not depend on the place of residence.
“I would not support the idea that living in the city is more expensive. This opinion prevails, because people living in the province can bring firewood from the barn or pour water from a well, and in the city there are no such opportunities and have to pay for all services. But it should also be noted that in the city and the quality of life is different. Yes, people in the city spend more money, but that money is not spent in vain – they receive services for it. In any case, in order to ensure a similar quality of life in both urban and rural areas, the costs would be similar, ”the economist told LNK News.
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