CAMBODIA: Cambodia is set to raise the monthly minimum wage for its textile and footwear workers by USD 2 per month, bringing the floor rate to USD 194 per month.
The raise will take effect from January 2022 and will affect the wages of 700,000 workers.
However, unions say the raise is still insufficient for workers during this unprecedented time. The new wage would be a struggle to live on, said Pav Sina, president of the Collective Union Movement of Workers. Unions in Cambodia have held strikes in previous years and requested a USD 12 raise in monthly wages.
"I request all relevant stakeholders, the employers, and the government, to consider the possibilities of adding more to the workers' wage," Pav Sina told local media.
Deputy Secretary-General at the Garment Manufacturers Association of Cambodia (GMAC), Kaing Monika, said the raise could be problematic with operating costs also expected to rise, as workers would spend more on pension and healthcare such as Covid-19 tests as a mandatory workplace measure, which already costs USD 4 month per head.
Cambodia’s garment industry was worth USD 7 billion a year before the pandemic and was one of the largest employers in the country, providing incomes to rural families that helped make apparel for global brands such as H & M, Adidas, and Nike. In addition, its exports of travel goods to the U.S. market were worth $3.5 billion in 2020, up 3.6% from 2019.
But as of April of this year, garments and textiles are no longer Cambodia's dominant export product, according to the World Bank. With agricultural goods and other new products on the rise, such as luggage, which is free of duties in the United States.