Employers Consultative Association of Malawi (Ecama) has said between January and August this year, the cost of basic needs, excluding transport expenses, has increased by 21 percent from K739 023 in January to K898 280 at the end of August.
But when transport is factored in, the total cost of living increased to K962 280, according to the employers’ trade association.
The data further show that food prices alone increased by 22.4 percent from K559 002 in January to K684 407.
The rising cost of living continues to force majority of low-income earners such as Dorcus Chirambo, who earns a salary of K300 000 per month, to adapt as she seeks to weather economic storm.
Due to the situation, she is forced to walk to work and back as a cost-cutting measure, but the situation is not getting any better.
Chirambo, a mother of four, said in an interview yesterday that while she saves about K25 000 a month, corresponding basics such as food and utility prices have been on the rise, making it hard for her to survive.
“We are barely managing to survive this tough economic environment,” she said in an interview yesterday.
During the review period, headline inflation rate increased from 27.3 percent in July to 28.2 percent in August, according to the National Statistical Office.
The cost of living portrays the cost of essential food and non-food items that comprise the minimum basket of goods needed for an urban household of six to survive with a decent and healthy standard of living, according to Ecam.
In an interview yesterday, Ecam executive director George Khaki said how individual employers respond to the situation will depend on their productivity, profitability and affordability of the wages and benefits to be offered to the employees.
He said: “However, we also need to look at several factors, including productivity rates of the employees, profitability rates of the employers, and affordability of the wages. Wages cannot be looked at in isolation.
“We must understand that the current operating economic environment with high inflation, shortage of foreign exchange, high interest rates and shortage of fuel are also impacting on the productivity of employers.”
Khakhi encouraged employers to genuinely discuss these matters with their workers to identify their challenges and come up with solutions that are mutually beneficial to all parties.
Malawi Congress of Trade Unions president Charles Kumchenga said in an interview that the cost of living has become unbearable for most workers in Malawi.
He said MCTU has on a number of occasions urged government to intervene to stabilise the economy.
He said: “This situation has led to most companies closing down and cutting jobs across the key economic sectors of our country
“We demanded a 100 percent increase of national minimum wage, but government only gave us less than 50 percent.”
International Labour Organisation (ILO) earlier said while statutory minimum wages serve as key tools to address low pay and wage inequality thus promoting social justice, between 1995 and 2022, the real value of minimum wages averaged across low-income countries, including Malawi fell by 44 per cent in real terms.
In July this year, Ministry of Labour announced a 40 percent increase in minimum wage with the general minimum wage increasing from K90 000 to K126 000 per month while the rate for domestic workers increased from K52 000 to K72 800 per month and that of the micro-enterprises has been increased from K75 000 to K105 000 per month.
ILO Minimum Wage Fixing Convention 1970 specifies that minimum wage levels should take into account both the “needs of workers and their families” and “economic factors, including the requirements of economic development [and] levels of productivity”.
