President Surangel Whipps Jr. said he hopes that the new year brings pay hikes to the workforce in Palau as he would continue to work with Olbiil Era Kelulau (OEK) to raise the hourly wages minimums in the country.
In his weekly press conference on Wednesday, President Whipps said that one of the priorities of his administration for 2022 is the passage of the minimum wage bill.
“One of the pieces of legislation that we need to work with the OEK about is the minimum wage. People can say the prices of power are up, but along with that we need to raise people’s wages,” Whipps said.
A proposed bill in the Senate, Senate Bill 11-9 is seeking an increase of minimum wage from $3.50 per hour to $4.25per hour effective Oct. 2022 and a ).75 cents increase every year after that until the minimum wage reaches $6.50 per hour,
The bill said that the last pay hike was mandated in 2013 and “ nearly eight years after, the minimum wage is still $3.50 per hour despite inflation and the steady rise in the cost of living in the republic.
The bill has Alpo proposed that by Oct. 1, 2021, the minimum wage would increase from $3.50 per hour to $3.75 per hour. The legislation however was not passed in 2021.
Several attempts have been made to increase the minimum wage after the hike in 2013 but the proposals have not passed.
For 2022, Whipps said the priority is to diversify the economy, find alternative sources of revenues, tourism recovery, and how to assist the people.
“How do we continue to diversify our economy? How do we build up tourism? And how do we help people that are really struggling?”
According to the International Monetary Fund ( IMF) economic report in December 2021, COVID-19 has affected the tourism-dependent economy.
The GDP contracted by 9.7 percent in FY2020 and is estimated to have further declined by17.1 percent in FY2021.
It added that the economic outlook “remains challenging,” with GDP projected to rebound by 9.4 percent in FY2022 with the gradual recovery in tourist arrivals, but still expected to be below pre-pandemic levels through FY2023.