Production Operator Price Trend and Forecast

Regional Price Overview

Get the latest insights on price movement and trend analysis of Production Operator in different regions across the world (Asia, Europe, North America, Latin America, and the Middle East & Africa).

Production Operator Wages Trend for the First Half of 2023

The production operations continued to rise in the first half of the year 2023. Rising labor costs remained the primary reason, as the labor wages continued on the uphill trajectory. Even though the rise in wages was evident, the rate and amount of rise started to cool down. The percentage rise in labor wages was lower as compared to the previous year. The primary reason being the beginning of normalization in living costs.

Various governments came up with relief packages, and as the war between Russia and Ukraine stretched beyond expectations, new trade routes were established, and supply chains were updated. The Chinese market also opened almost completely, solving a lot of manufacturing and supply chain issues. And most of all, normalization in freight costs impacted the goods prices substantially. So, the production costs/ production operator costs rose during the said period but at a slower pace than the previous year.

Analyst Insight

According to Procurement Resource, the production operations/ production operator costs will continue to oscillate on the upper side as the labor wages usually follow a unilateral path, so the costs will rise, but the pace is expected to maintain its current momentum.

Production Operator Wages Trend for the Year 2022

Production Operator economy can be directly deciphered by understanding the changes in worker wages experienced over the discussed period. In the year 2022, a rise in worker wages was observed, especially in the western part of the world; the rise was about 5% YOY, which is considered quite high in the context of basic wages. But still, a striking rise of about 50 % was observed in labor strikes and campaigns asking for wage raises.

The primary reason behind this dissatisfaction and also the observed wage raise was decreased purchasing power. The global economy was already struggling as trade was hindered because of the restricted supply chains and constricted market access because of the COVID-19 pandemic. Before the world could completely recover from pandemic shocks, a full-fledged war in the European continent shook the economic ecosystem once again. Even though the wages were raised, they didn’t grow in accordance with the rise in living costs. Thus, the production operations cost more in the year 2022 compared to previous years.

Analyst Insight

According to Procurement Resource, with the ongoing distrust and rise in labor strikes, the operation costs/production operator costs are likely to continue rising in the upcoming months as well.

For the Fourth Quarter of 2021

Asia

In the fourth quarter of 2021, the Ministry of Labour and Employment changed the level of VDA for 1.5 million central sphere employees. The boost, which took effect on October 1, resulted in an increase in the minimum wage for employees and workers in the core sphere. Factory labour salaries in New Delhi, India were confirmed at 749 INR/day for Skilled Factory Workers with effect from October 2021. The tariff in Bihar was set at 301 INR/day.

Europe

In the fourth quarter of 2021, wages in the European Union climbed 2.8% year on year over the same time the previous year. The EU Member States' minimum wages varied from 332 EUR/month in Bulgaria to 2257 EUR/month in Luxembourg in January 2022.

North America

Within the last quarter of the year, minimum wages in the United States increased. In 2022, minimum-wage workers in the United States will receive a raise. In January 2022, new minimum wage legislation went into effect in 21 states and 35 cities around the United States. Per the National Employment Law Project, this was the highest simultaneous increase in sub-national minimum wage regulation in US history. While most states' minimum wages grew to 10 or 13 USD an hour, California and New York adopted statewide minimums of 15 USD.

Latin America

In the LATAM region, there were huge differences in minimum wages from nation to country. While basic goods and services were easily accessible to a Chilean worker on a minimum wage, a Venezuelan worker would have needed 156 such minimum wages to acquire the most basic core diet items. In November 2021, Argentina's minimum salary was 31,938 Pesos. In November, the cost of basic food items jumped by 2.6%, implying that a household of two adults and two school-aged children would require 31,724 Pesos to stay above the poverty line, nearly a month's wage.

For First, Second and Third Quarters of 2021

Asia

For the majority of the first quarter of 2021, India's National Floor Level Minimum Wage (NFLMW) stayed steady at 178 INR/day, unchanged from 178 INR/day in 2020. However, in the latter half of March 2021, circumstances altered. At a time when the country was grappling with the second wave of the COVID-19 pandemic, the Ministry of Labour & Employment of the Government of India published and amended the rate of Variable Dearness Allowance with effect from April 2021.

The VDA is updated on a monthly basis using the Labor Bureau's Consumer Price Index for factory workers (CPI-IW). The latest VDA modification was calculated as the average CPI-IW for the months of July to December 2020. This helped around 1.50 crore workers in various scheduled jobs in the central sector throughout the country. A highly skilled industrial worker was entitled to a minimum of 853 INR/day under this plan, while an unskilled worker was entitled to a minimum of 645 INR/day.

Europe

Following the expansion of COVID-19 throughout the EU Member States in 2020, authorities responsible for setting the minimum wage had a difficult task in determining the new rates. Confronted with rising unemployment, extreme economic uncertainty, and the disruption of usual negotiating and consultation processes, the majority of European countries agreed to modest gains in their statutory minimum wages beginning in January 2021.

Minimum wage rates had been hiked by more than 5% in six Central and Eastern European nations. Latvia, Slovenia, Poland, Slovakia, Bulgaria, and Lithuania were among them. Several veteran member states such as Portugal, Luxembourg, the Netherlands, Germany, France, and Ireland saw a smaller increase. In the case of the United Kingdom, the 2.2% increase in pound would have topped 6% if yields had been measured in euro.

North America

Despite the magnitude of the disruption to the US labour market caused by the coronavirus epidemic, employed employees' incomes were substantially unchanged. The median pay in the United States increased during the COVID-19 recession, as lower-paid employees lost jobs.

Earnings remained stable overall during the epidemic, partly because lower-wage individuals suffered more job losses. Thus, in 2021, the average employed person earned more than the average hired worker in 2019. In 2021, a decline in inflation helped all workers by increasing the purchasing capacity of their earnings. Prior to the second coronavirus pandemic, the median wage for employed Americans had remained stable at around 21 USD/hour for several quarters.

Latin America

Argentina signed a 2021 agreement establishing a gradual increase in pay, with the increase expected to bring it to 33,000 Pesos, a 52.7% year-on-year increase in 2021. From May 1, 2021, the minimum monthly pay rate in Chile was 337,000 Pesos for workers aged 18 to 65, and 251,394 Pesos for those over 65. On September 1, 2020, the minimum wage was 326,500 Pesos, with the uptick in May 2021 increasing the monthly paycheck by 10,500 pesos.

For the Year 2020

Asia

India has the most affordable labor costs in Asia, with a national minimum salary of approximately INR 176 (USD 2.80) a day, approximately INR 4,576 (USD 62) each month. This was a nationwide minimum wage and it varied according to the geographical region and other factors. More broadly, a global assessment of average monthly salaries revealed that India earned an average of INR 32,800 (USD 437) each month.

The monthly minimum wage computation includes a variable dearness allowance (VDA) component that takes inflationary trend into account, such as the rise or fall in the Consumer Price Index (CPI), as well as, if available, a dwelling rent allowance (HRA). The government appointed inspectors-turned-facilitators to conduct inspections to guarantee that businesses were in compliance with the new pay law.

Europe

In June 2020, the majority of EU countries increased their statutory minimum wages for 2020, in many cases significantly, as in Poland (17%), Slovakia (12%), and Czechia (11%). In total, all EU Member States increased their minimum tax rates in comparison to 2019. Year-on-year hikes ranged from 17% in Poland (EUR 523 to EUR 611) to 1.2% in France (EUR 1,521 to EUR 1,539), while prices in Latvia remained steady. Portugal's mean gross minimum wage increased by 8.4% to EUR 740.

North America

Between 2019 and 2020, wages in the United States grew at a historically rapid rate, 6.9% for the typical worker, but not for positive reasons. The US economy received a hit unlike any other in recent times, in 2020. Wages increased substantially as a result of the fact that more than 80% of the 9.6 million net job losses in 2020 were held by wage workers in the bottom 25% of the pay gap.

7.9 million low-paid workers left the workforce, while 1.5 million positions in the upper half of the income spectrum were added, skewing average wages upward. Wage inflation in 2020 was neither cause for jubilation nor a justification to infuse policy debates with fears of economic overheating.

The majority of workers had a fairly weak bargaining position, which limited their ability to get pay increases adequate to compensate for decades of poor wage growth. In comparison to other recent recessions, this pandemic-induced economic downturn was especially difficult on low-wage employees, who continued to require assistance. In 2020, less than 75% of low-wage workers remained employed, compared to more than 90% of high-wage workers in the top 25% of the wage distribution. To summarise, wages increased in 2020 as the low-wage labour market reached its lowest.

Latin America

Since 1 October 2019, Argentina's statutory monthly minimum wage had been 16,875 Pesos (USD 229.4) per month, which equates to 84.37 Pesos (USD 1.15) per hour. In April 2020, the federal minimum wage was updated for inflation and remained at 1,045 Reais (US$186) per month for the remainder of the year. In actuality, only tiny local firms adhered to this required monthly minimum pay.

Large enterprises and multinational organisations paid employees more than the minimum wage, either as a matter of public policy or to comply with the terms of the applicable collective bargaining agreement. On 3 April 2020, in response to the covid-19 issue, the Chilean government also passed a bill providing a monthly subsidy of 300,000 Pesos to employees earning less than 384,363 Pesos/ month. The minimum monthly pay in Colombia was 877,802 Colombian Pesos.

Procurement Resource provides latest wages of Production Operator. Each price database is tied to a user-friendly graphing tool dating back to 2014, which provides a range of functionalities: configuration of price series over user defined time period; comparison of product movements across countries; customisation of price currencies and unit; extraction of price data as excel files to be used offline.