Wage disparity in Egypt crushes the middle class

“The poor are getting poorer, and the middle class is melting away…” This is the case for most Egyptian citizens who suffer from wage differentials and the absence of social justice that were among the essential demands and slogans of the January 25, 2011 revolution. The disparity in wages is noticeable even within the state’s administrative apparatus, where the minimum wage was set at EGP 1,200. In light of the lifting of subsidies, the state refused to set a maximum wage. Although the government announced from time to time the formation of committees to study wage disparities and address the problem, especially with the commemoration of the International Day for Equal Pay, government laws that exude favouritism are the reason for this disparity.

According to the United Nations, the International Day for Equal Pay, celebrated for the first time in September this year, marks long-term efforts toward equal pay for equal value work. The observance of the day builds on the United Nations’ commitment to human rights and against all forms of discrimination, including discrimination against women and girls. In Egypt, the Central Agency for Public Mobilisation and Statistics’ official figures stated that the difference between wages does not come at the level of the position only, but also varies from one governorate to another. According to government agency figures, it is possible that there is one profession, but whoever works in a particular governorate has more income than those who work in another governorate.

Wage disparity

For his part, Saleh al-Sheikh, head of the Central Agency for Organisation and Administration, said that the Prime Minister requested a study related to wage discrepancies within the state’s administrative apparatus. A request was sent to all the various parties. In a press statement last May, the Sheikh clarified that some authorities did not send what they were given in terms of wages. However, the aim was to identify salary levels within the state’s administrative apparatus. He added that some employees leave certain sectors and go to others because of salaries, which caused the emptying of competencies in some sectors.

The Civil Service Law, which was approved by parliament immediately after its inception in 2015, is not without racism and discrimination between government employees and does not stop only at the disparity in wages. This law applies to state employees and excludes the army, police, oil workers, the Ministry of Finance, and the Council of Ministers. Perhaps this explains the data issued by the Central Agency for Public Mobilisation and Statistics last June, which made it clear that workers in the mining and quarrying sector were at the forefront of the economic sectors in which workers receive the highest wages and salaries during the last quarter of the fiscal year 2018/2019. The data indicates that the average daily wage for this category increased from EGP 90 to EGP 143, an increase of about 58.8 per cent.

The exclusion of certain entities from the application of the civil service law came in light of the circulation of high salaries for officials in banks and oil, in addition to successive increases in the wages and pensions of the army and police officers. This coincided with the low salaries of the employees in other departments and the closing of appointments to reduce the number of employees in the state’s administrative apparatus, which placed more burden on these bodies that suffer from a deficit of employees.

Middle class

Between those with high incomes and those whose salaries require compassion, the minimum wage remains at EGP 1,200, which is not sufficient to meet the needs of a family of two. Wage disparity in an obscene manner in light of the high prices and the high cost of living was one of the factors that crushed the middle class in Egypt and turned it into low-income, and caused the transfer of the poor to the category of the oppressed and destitute. The government has set the poverty level for those with a monthly income of EGP 736 Egyptian ($45), a figure that economists consider very low.

In April of last year, the World Bank said that 60 per cent of Egyptians are either poor or vulnerable to poverty, while a report by The Economist indicated that the most impoverished Egyptians are the ones who spend 48 per cent of their income on food. Another Bloomberg Network report in August 2019 indicated that most Egyptians are suffering badly due to devaluation, which made the pound lose more than half of its value. In light of the disparity in wages and the absence of social justice, ordinary Egyptians live a difficult life, as nearly a third of the population suffers from poverty, which is double the figure from the beginning of the century.