Wages in informal private sector rise

by Sapumali GALAGODA

The daily wages of the informal private sector showed upward movements, at varied rates, in nominal terms, states the 2010 Central Bank Annual Report.

Wages in the informal private sector, which fall outside the public and formal private sector are collected under a regular survey carried out under the Countrywide Data Collection System (CWDCS), relating to the agriculture and building construction sectors.

Generally wages in the informal private sector get adjusted to reflect both demand and supply conditions in the economy and the level of the reservation wage of labour.

Accordingly, informal sector wages in the Agriculture and Construction sectors increased by 9.1 percent and 7.3 percent in 2010 when compared to the previous year. Within the Agriculture sector, the average daily wages of sub-categories of rubber, tea, coconut and paddy increased by 11.0 percent, 10.7 percent, 7.9 percent and 7.3 percent, in 2010 against 2009.

The increase was relatively higher in the tea and rubber sub-sectors, probably due to the increased export prices in the international market, which enabled producers to make higher payments to workers, and the sharp increase in wages of workers in the formal sector plantations.

Gains in the real wages of employees in all sub-categories in the agriculture and construction sectors were recorded in 2010.

Accordingly, the daily real wages of rubber, tea, coconut and paddy sub-sectors in the agriculture sector, on average, increased by 4.7 percent, 4.5 percent, 1.8 percent and 1.3 percent.

Meanwhile, the real wages of masonry and carpentry in the Construction sector recorded lower increases of around 1.5 percent and 1.1 percent.

Overall both the Agriculture and Construction sectors recorded lower increases in the real wages around 3.0 percent, in 2010 compared to real wage increases of 8.2 percent and 6.9 percent, recorded in 2009.