The wages in the Sri Lankan apparel sector have not risen at the same pace as the growth in GDP, export earnings or cost of living, and hence, there is a need to revise the wage formula, a noted economist has said.
Speaking at a seminar on “Foreign Investments & Garment Industry: What’s Wrong, Where”, Dr. Nishan De Mel, Director of Verite Research, suggested that wage increases be tied to net export earnings per worker.
The Sri Lankan apparel sector registered remarkable growth in terms of net export earnings per worker in 2011 and 2012, but wage rises have not been at par with export earnings, Dr. De Mel said.
He termed the annual wage increment of SL Rs. 25 to Rs. 35 during 2004 to 2007 as useless. He opined that the quick rise in annual wages between Rs. 150 to Rs. 200 since 2008 was meaningless in view of other factors.
According to him, the annual rise in wages of Sri Lankan garment workers had been out of reality and the Ministry of Labour should closely look at exports and wage trends in the clothing sector.