Economic Minister Fayyaz Ismail said that the introduction of the minimum wage would affect businesses and that it was likely that some businesses may go bankrupt as a result.
At the inauguration ceremony for the minimum wage held at Hotel Jen, Minister Fayyaz said that businesses and jobs may experience difficulties in the short run because of the minimum wage. However, he said, businesses would benefit in the long run.
“Some businesses may have to restructure. Some may have to downsize. It is likely that some businesses may even go bankrupt. It is possible that some people may lose their jobs”, Minister Fayyaz had said.
Minister Fayyaz said that the minimum wage would motivate worker efficiency which would in turn improve the efficiency of businesses. He said that he believed that complaints of not getting local workers who would stay on would also come to an end.
“It could be that local workers can’t be retained at jobs because of the wages. The minimum wage would be an added factor to improve retention of local workers, which would improve business efficiency and the health of the economy”, said the Minister.