President Ollanta Humala on Wednesday announced that the government would increase the minimum wage by 13 percent, effective May 1.
Humala, who is approaching the end of his five-year term, said that the minimum wage would increase to 850 soles (about US$254) a month from the current 750 soles, according to business daily Gestion.
“What we are doing is social justice,” he said during a speech in the southern highlands of Puno. “We have built equality with social policy.”
After taking office in 2011, Humala raised the minimum wage by 150 soles a month in a two-part increase. Peru’s minimum wage was 600 soles a month when was elected.
Labor Minister Daniel Maurate said that the hike would benefit some 650,000 workers, mainly in small and medium-sized businesses.
Business groups have previously argued that the minimum wage should only be increased based on improved productivity in the economy.
Maurate said that the raise wouldn’t hurt Peru’s economic performance as it is updates wages based on higher “inflation and productivity.”
President Humala made the announcement 10 days before Peru’s presidential election to choose his successor. Humala, a former military official who ran as a leftist but governed from the center, is constitutionally-barred from seeking a second consecutive term.