Timeshare sector supports a decent wage for every worker, and proposes an independent impact study,
a phased path, cost-of-living reductions through state-owned companies, and fiscal compensation for
higher payroll costs
ATSA shares the goal behind the government’s proposal: anyone who works a full week in Aruba should be
able to cover their basic needs. That is not in question. What is in question is how we get there, and
whether a higher wage will still be worth something to workers a year after it takes effect.
Today the statutory minimum wage stands at roughly Afl. 2,007 per month, for a 40 hour week, while the
subsistence minimum (bestaansminimum) for a single person, as published by CBS, reached Afl. 2,700 in
September 2026. Closing that gap in one step means an increase of about Afl. 690 per month, or roughly
35%. With employer premiums and charges of around 25% on top of gross pay, the real cost to an
employer approaches Afl. 860 per worker per month, before any adjustment for employees who currently
earn just above the minimum. A change of that size should be built on evidence, not on a deadline.
A wage increase on its own is unlikely to be enough without measures that protect purchasing power,
employment and the viability of businesses.
Why the research has to come first
The target moves. The subsistence minimum is recalculated as prices change; it rose from Afl. 2,683 in
July to Afl. 2,700 in September 2026 alone. Fixing the minimum wage to an index that itself rises with
prices risks a wage-price loop in which workers chase a line that keeps moving away from them.
The basket is dated. The subsistence calculation rests on household spending data collected some
twenty years ago. Aruban households spend very differently today. An updated household budget
survey is the starting point for any serious decision.
A wage is not a household income. Some minimum-wage earners live in households with several
incomes; others support dependants on one. Today nobody can say precisely how many households
live below the subsistence minimum, and therefore who most needs help.
Total compensation is not being counted. In hospitality, tips, service charges and monetary bonuses
often form a meaningful part of what an employee takes home, alongside in-kind benefits such as
meals, transport and uniforms. Are these taken into account when wages are compared to the
subsistence minimum? If not, the gap is overstated for some workers, while for others who depend on
volatile tips, real income security may be understated. A study must answer this explicitly.
Gross is not net. Part of the distance between the minimum wage and the subsistence minimum is
taxes and premiums. Some of it can be closed on the net side, at no cost to employers.
Technology changes the equation
Research on minimum wages suggests that moderate, predictable increases have limited effects on
employment, while large, abrupt ones carry more risk, often showing up first as fewer hours and slower
hiring. Today there is an added factor: self-service check-in, digital kiosks, online ordering and AI-driven
reservations are now affordable and readily available.
So the question has to be asked: when labour costs rise sharply overnight, what does a business with thin
margins do? For many, the answer will be to automate. And which jobs go first? Front desk, cashier, call
centre and back office: the very positions this policy is meant to protect. What is a higher minimum wage
worth to the worker whose job has been replaced by a kiosk? Before any decision is taken, the research
should show which roles are most exposed.
The cost of doing business is the other half of the equation
Wages are one line in a cost structure that is already among the highest in the region: electricity and water,
telecommunications, import duties, turnover taxes, port and airport charges, and rent. Where margins are
thin, an abrupt payroll increase cannot be absorbed. It is passed on in prices, including the prices of the
very goods in the subsistence basket, and part of the worker’s gain disappears. Every cost Aruba removes
from the system relieves both businesses and households at the same time.
Close the gap from both ends: what ATSA proposes
1. An independent impact study before any decision. Led by CBS and the Central Bank of Aruba, together
with the social partners, and covering: an updated household budget survey; household-level incomes;
total compensation including tips, service charges and bonuses; sector-by-sector effects on costs,
prices, hours and jobs; knock-on effects for employees above the minimum; and exposure to
automation.
2. A study of state-owned companies. How far can government-owned companies in utilities,
telecommunications, ports and the airport reduce their costs and tariffs, so that basic needs such as
electricity, water, internet and imported food become cheaper? Lowering the subsistence minimum
itself narrows the gap without adding a single florin to payroll.
3. Fiscal compensation for higher payroll costs. Options include a temporary reduction of employer social
premiums on lower-wage jobs, a targeted wage-cost allowance for businesses, a higher tax-free
threshold so that net pay rises without increasing payroll, and relief on turnover taxes for essential
goods. Such measures must be transparent, proportional and subject to proper controls.
4. A phased and predictable path. A published multi-year schedule with fixed review points, monitored
by an independent wage body that reports annually on prices, purchasing power and employment,
along the lines of the low-pay commissions used in several European countries, with the ability to
adjust the pace when the data call for it.
Nobody in our sector disputes that a full-time worker should be able to live decently in Aruba. What we ask
is that we measure before we act. A raise that is eaten by higher prices, or that costs someone their job,
has not helped that worker. Let us get the facts, lower the cost of living where government can,
compensate the payroll burden fairly, and then move step by step towards a wage that lasts.
ATSA remains committed to the Social Dialogue and stands ready to contribute data and expertise from the
timeshare sector to the research it proposes.