Byles defends comment on large wage increases

By Prince Moore    

 

Governor of the Bank of Jamaica Richard Byles has sought to clarify his comment cautioning employers against massive wage increases amid backlash from trade unionists and members of the public.

 

Mr. Byles has said a large jump in salaries could have a negative effect on inflation.

 

Speaking Thursday on Radio Jamaica's Beyond the Headlines, the BOJ governor said his comment was taken out of context. 

 

"At the conference, somebody asked me, what is my view on very large increases. That is what the journalist asked me. My answer to the journalist was, if you are trying to recover from inflation and you are giving an increase to that point, that is fine. If you are going beyond that and you have an increase in productivity, that is also fine. Neither of those have an impact on inflation. But if you are going to give a very large increase, which I assume to be more than what inflation has been, then we are going to have an impact on inflation by so doing. And that is the concern of the Bank of Jamaica," he insisted. 

 

Mr. Byles said his comment was not intended to prescribe how workers should be paid. 

 

"I don't comment on any particular wage increase. But generally speaking, wage increases in the economy beyond inflation, run the risk of stoking inflation even more. That's just a statement that I need to make as part of my job of managing inflation. Nothing more. I don't intend to advise any group or anyone in respect of how much beyond what I am saying." 

 

Business interest groups say they have no choice but to significantly increase salaries in order to attract and retain qualified workers.

 

The Jamaica Manufacturers and Exporters Association and the Micro Small and Medium Enterprises Alliance have argued that the massive increases in public sector salaries have resulted in a negative ripple effect for the private sector.