Ouch, that\’s gotta hurt

Fackson Shamenda, Zambia\’s labour minister has gone to the Chinese-owned Collum coal mine in Sinazongwe, 200 miles south of the capital Lusaka to try and broker a peace deal. The miners are on strike because their wages are lower than a new minimum wage of £205 a month paid to shop workers.

GDP per capita is around $1,600….£1,100 close enough. And they\’ve a minimum wage (for one sector, sure) of £3,000 a year?

What are they doing? It would be like saying that the UK minimum wage should be £60,000 a year.

It\’s not going to work, is it?

13 thoughts on “Ouch, that\’s gotta hurt”

  1. Careful what you suggest. Polly would love to enforce a uk minimum wage of £60,000 for everyone (except perhaps the polish girl who cleans her house).

  2. The sentence is ambiguous. Does it mean a Minimum Wage, set and enforced by government, or does it just mean the lowest wage that shop workers happen to get? Either way three times gdp per capita seems astonishingly high.

  3. It’s a new-ish law – came in to force 4th July.

    Although I make it £147.52 per month (1,132,400 Kwacha) for the “Grade 1” shopworker up to £309.07 for “Grade 8”. £205 per month is somewhere between Grades 3 & 4.

    This seems to be the important difference:

    Mr Shamenda said the signed statutory instruments cover vulnerable groups of employees who are not represented by trade unions.

    The miners’ union is clearly not putting its weight behind its members. Another thing Zambia has clearly learned from Britain.

  4. What proportion of Zambia’s working population are subsistance farmers (with, in effect, cash earnings of near zero)

  5. GDP per head figure may be skewed by subsistence farming.

    If there’s still enough of that, there could be a big divide in measured GDP between those with jobs and those scratching a living from the soil.

    Indeed it could be a valuation issue; there could be a big divide in measured income without there being much of a divide in living standards. A successful subsistence farmer will have food, shelter and heat without having to pay for it. If that’s not properly valued in the GDP figures, then GDP per head will be artificially low.

  6. Beaten by Richard. These places look artificially poor (not saying they aren’t dirt poor because they are, just that GDP overstates the poverty) because it doesn’t capture either the household production or much of the grey and black economy. Also means that for those engaged in the official economy things are generally a lot better than raw GDP numbers would suggest.

  7. If I wasa subsistence farmer there I’d jack it in and get a job at Debenhams, or there equivalent of.

  8. Rob: At those wages, I think Kaundamart would have a queue a mile long for the three positions available, all of which are probably promised to the trade union leader’s third cousins twice removed anyway. Your average subsistence farmer isn’t going to stand a chance.

  9. Rob (#8). not without first checking how much of your wage would be taken in tax, social security, union dues, bribes, whatever, or how much it would cost you for a room and food.

  10. Also Tim’s comparing GDP per capita to wages, which by definition are only per economically active person.

    If you had 50% economically inactive (mainly the very young in Africa), then your GDP per capita of £1,100 would be £2,200 per economically active person, which is the rough comparison you’d want to wages.

    OK, it’s probably not 50%, but isn’t Zambia one of those places that’s still got a high birth rate, plus a high incidence of AIDS, so the population probably is more skewed towards children.

  11. Interesting to see the Chinese inheriting much of the opprobrium that used to be directed at the imperialist whiteys. This started a few years ago in Sudan, and I imagine it’s only going to get worse as the Chinese involve themselves more in Africa.

  12. At those wages, I think Kaundamart would have a queue a mile long for the three positions available, all of which are probably promised to the trade union leader’s third cousins twice removed anyway.

    No, this is Africa. It will be his wife, siblings, and in-laws who get the jobs. If there are more jobs than immediate family, he will ensure that they will all be employed via his wife’s manpower agency, which takes a hefty cut and neglects to pay the workers. Second cousins would get shafted along with the rest.

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