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Wage Hike for GFT Workers Rings in New Year with Promise

by Surya Narayan
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As the calendar turned to 2024, there was cause for celebration among garments, footwear, and travel goods (GFT) industry workers as the minimum wages in the sector rose to $204. This increase was in accordance with directives from the minimum wages authority and Prime Minister Hun Manet, issued last September. PM Hun Manet took to social media to express his congratulations to the workers and shine a light on the government’s dedication to improving their living standards.

The National Minimum Wage Council implemented a $2 raise, and in addition to this, the Premier directed an extra $2 hike, bringing the total increase in minimum wages to $4. The GFT workers can also enjoy other benefits, such as monthly travel allowances of $7, a $10 monthly work bonus, monthly seniority bonuses ranging between $2 and $11, as well as additional compensation for overtime work.

The Ministry of Labour and Vocational Training confirmed that the minimum wage received by a GFT worker currently ranges between $221 and $232. This wage increase aligns with the National Government’s efforts to enhance the overall welfare of workers in the GFT sector, which plays a vital role in the national economy.

Industry associations in the footwear and travel goods sector have welcomed the minimum wage hike for 2024, stating that it will ensure the sector’s competitiveness and improve the living standards of workers. The Cambodia Footwear Association issued a statement expressing their full support for the $204 monthly minimum wage increase and their commitment to implement government interventions aimed at improving livelihoods and generating job opportunities.

The Cambodia Travel Goods and Leather Association highlighted that no other country in the region has dared to increase minimum wages in the industry during the post-pandemic recovery period. In 2023, the monthly minimum wage was raised from $194 to $200.

An economist from the World Bank shared their perspective, stating that as Cambodia’s economy continues to experience remarkable growth in the post-pandemic period, minimum wages are expected to rise across sectors. They emphasized that Cambodia still has progress to make in increasing minimum wages, with its wage premium currently one of the lowest at 18.8. It is anticipated that salaries will continue to increase in both the private and public sectors in the years to come as Cambodia pursues its goal of becoming an upper-middle income nation by 2030.

The garment, footwear, and travel goods industry are the largest foreign exchange earners for Cambodia, with a total of 1,332 factories employing approximately 840,000 workers in textile, garment, footwear, and travel goods manufacturing. Cambodia’s export figures for the first 11 months of 2023 revealed a total of $9.9 billion worth of garment, footwear, and travel products sent to international markets.

With the rise in minimum wages and ongoing efforts to uplift workers’ standards of living, the GFT industry can look ahead to a promising future as a pivotal contributor to Cambodia’s economy and socio-economic development.

Source: Khmer Times

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