Only ‘urgent’ minimum wage hike can halt economic slowdown

Santo Domingo – The Santo Domingo Institute of Technology (INTEC) School of Economics on Tues. urged the Government to submit a bill which raises the minimum wage, to recover the economy in the short term, noting that the slowdown has affected GDP growth, which fell from 5.3% in the first quarter to 2.7% in 2Q.

In the second Analysis of the Dominican Economy (IAED), Intec’s Economy and Business Faculty stressed the need to recover sales so that the business sector can regain confidence for new investments. “It is necessary to stimulate aggregate demand by increasing the purchasing power of salaried workers and informal employment.”

“Low interest rates alone don’t guarantee the exit from the growth slowdown or the stagnation of revenue. If the product grows substantially, but employment doesn’t grow as much, this means that productivity per worker is increasing and should have compensation in terms of wages, that however doesn’t occur in the Dominican economy,” the economists said in the document.

The report was presented by Economy and Business Faculty dean Franklin Vásquez, and Economics Career coordinator, Rafael Espinal, during a press conference at INTEC.