Minimum Wage Could Cost Jobs

October 03, 2019

Employers Consultative Association of Malawi (ECAM), a representative body of employers, has expressed fears of potential jobs losses due to the increase in minimum wage from K25 000 to K35 000 per month.

ECAM executive director George Khakhi said in an interview yesterday that with the 40 percent raise in minimum wage, employers that are struggling to pay salaries could retrench employees while others may shift to automation to minimize production costs, thereby impacting on jobs.

Khaki said more firms in the small and medium enterprises (SMEs) category could end up reverting to the informal sector, which could cost government tax revenue.

He said: “What we are seeing with this hike is that, already, we are suffering with pension arrears and having minimum wage increased could put more pressure on employers.

“So, the higher you raise the minimum wage, the more costs that employers will have to incur. We will be doing a study next year to establish the exact impact of this wage hike,” he said.

In his 2019/20 National Budget Statement a fortnight ago, Minister of Finance, Economic Planning and Development Joseph

Mwanamvekha said the adjustment in minimum wage will help protect lowlypaid workers and improve their welfare.

The minimum wage hike came three years after Treasury last increased the rate by 24 percent from K19 000 to K25 000 a month.

ECAM Trains Managers in Effective Employee Engagement Strategies

October 03, 2019

Renowned psychologist Dr. Chiwoza Bandawe says organisations are at a better position to reach their goals if they learn to engage and motivate their working force.

 

Bandawe said this when he was giving a presentation at the Developing Strategies for Effective Employee Engagement Workshop that was organised by the Employers' Consultative Association of Malawi (ECAM) in Blantyre on Tuesday.

 

“My presentation was looking at issues of motivation and engagement. How can companies ensure that their employees are as engaged as possible? Because what can happen is that people can come to work but not fully engaged with goals of the organisation.

 

“If workers are not motivated and engaged- it compromise organisation’s productivity, ability to achieve their goals, people will be sabotaging and profit margin will be greatly affected,” said Bandawe.

 

Concurring with Bandawe, another key presenter at the workshop, Laston Masumba- from Impact Management Consultants added that: “Highly engaged employees have a passion for their work and feel a deep connection to their organisation; disengaged employees have essentially checked out—putting time but not energy or attention into their work.”

 

One of the participants, Blessings Dambo from G & T Construction Company ,described the workshop as an eye opener and timely.

 

“There is a growing disengagement between workers and their employers, leading to a lot of industrial strikes and to some extent sabotage. So this workshop has come at a right time and has targeting a right cross-section of middle managers who deal with workers directly,” said Dambo.

 

Taking her turn, ECAM communications and projects officer Ellen Ziwoya-Phiri said her organization held the workshop as one way of fulfilling its obligation of promoting skills development and worker productivity.

 

“We must ensure that we address fundamental rights at work, that can facilitate economic growth. As members of ECAM, we are drivers of policy and laws in the workplace,” she said.

 

ECAM was registered in 1963 under the Trustees Incorporation Act of Malawi as an employers’ trade association representing all subscribing employers. It has direct membership from 250 organizations, which includes six associations. The associations represent over 277,000 members.

 

It’s primary role is the promotion, guidance and protection of employers’ interests in labour, employment and socio-economic issues.

Third Quarter Cost of Living Update

October 03, 2019

The basic needs basket totaled MK 264 505 in the month of June. From June to July, total expenditure for the basic needs basket further rose to MK269, 337 representing 1.82 percentage increase. The increase in the basic needs basket in the month of July is attributed to rapid increase in the prices of maize over a short period of time. In the first week of the month of July, maize prices rose up to average of MK10,000 per bag from MK8500. The prices further went up to MK12500 per bag in the second week of July. Within the two weeks, maize prices rose by 18 percent and 25 percent respectively. The reason for the rise in maize is due to speculations on the market. In the month of August, the basic needs basket fell despite continued increase in maize prices. From costing MK269 337 in the month of July, the basic needs basket decreased to MK264 875 in the month of August. The Price of a bag of maize further rose to MK13 000 from MK12 500 on average. The decrease for the basic needs basket representing 1.95 percent is attributed to a sharp decline in the prices of tomatoes. Tomatoes which were being sold an average price of MK737 per kg in the month of July, currently cost MK350 per kg. The reason for the decrease is due to abundant supply of tomatoes in the market. The basic needs basket remained constant from August to September.

INFLATION

The annual headline Inflation rate has increased from 9 percent in the month of July to 9.3 percent in the month of August and further to 9.5 percent in September. Food inflation rose by 0.5 percentage points from 13.7 percent to 14.2 percent and non-food inflation stands at 5.5 percent from 5.4 percent in the month of July. Currently food inflation stands at 14.6 percent and non-food inflation at 5.4 percent, representing a 0.2 percentage points increase and 0.1 percentage points decrease respectively. The increase in headline inflation has mainly been influenced by increase in maize prices.

et totals MK270 406 in

the month of August. The decrease represents 1.59 percent and is attributed to a

sharp decline in the prices of tomatoes. Tomatoes which were being sold an

average price of MK737 per kg in the month of July, currently cost MK350 per kg.

The reason for the decrease is due to abundant supply of tomatoes in the market.

On the other hand, the price of a bag of maize has further risen to MK13 000 from

MK12 500 on average. There has also been a slight increase in the prices of some

non-food items such as toothpaste and bathing soap.

 

The annual headline Inflation rate has increased from 9 percent in the month of

July to 9.3 percent in the month of August. Food inflation rose by 0.5 percentage

points from 13.7 percent to 14.2 percent and non-food inflation stands at 5.5

percent from 5.4 percent in the month of July. The increase in headline inflation has

mainly been influenced by increase in maize prices and some non-food items.

 

At the beginning of the month of August, the Kwacha continued to appreciate against

major currencies which are Dollar, Pound and Rand. The Kwacha has gained to an

average of MK742 from MK750 against a Dollar. To the Pound, the Kwacha is trading at

an average of MK901 from MK911 for one Pound. The Kwacha further appreciated to

the Rand reaching an of average MK48 from MK51 per Rand. The relatively weak

demand on the domestic market coupled with trade tension between United States of

America (USA) and China led to the weaknesses of the major currencies against the

Kwacha on the exchange rate market and hence Kwacha’s good performance.

Cost of Living Update

September 04, 2019

The basic needs basket falls despite continued increase in prices of maize. From

costing MK274 769 in the month of July, the basic needs basket totals MK270 406 in

the month of August. The decrease represents 1.59 percent and is attributed to a

sharp decline in the prices of tomatoes. Tomatoes which were being sold an

average price of MK737 per kg in the month of July, currently cost MK350 per kg.

The reason for the decrease is due to abundant supply of tomatoes in the market.

On the other hand, the price of a bag of maize has further risen to MK13 000 from

MK12 500 on average. There has also been a slight increase in the prices of some

non-food items such as toothpaste and bathing soap.

 

The annual headline Inflation rate has increased from 9 percent in the month of

July to 9.3 percent in the month of August. Food inflation rose by 0.5 percentage

points from 13.7 percent to 14.2 percent and non-food inflation stands at 5.5

percent from 5.4 percent in the month of July. The increase in headline inflation has

mainly been influenced by increase in maize prices and some non-food items.

 

At the beginning of the month of August, the Kwacha continued to appreciate against

major currencies which are Dollar, Pound and Rand. The Kwacha has gained to an

average of MK742 from MK750 against a Dollar. To the Pound, the Kwacha is trading at

an average of MK901 from MK911 for one Pound. The Kwacha further appreciated to

the Rand reaching an of average MK48 from MK51 per Rand. The relatively weak

demand on the domestic market coupled with trade tension between United States of

America (USA) and China led to the weaknesses of the major currencies against the

Kwacha on the exchange rate market and hence Kwacha’s good performance.

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