On Thursday, the government revealed a significant increase in minimum wage rates through the revision of the Variable Dearness Allowance (VDA), aiming to assist workers in managing the rising cost of living. This adjustment will particularly benefit those in the unorganised sector, including workers involved in construction, loading and unloading, cleaning, housekeeping, mining, and agriculture within central sphere establishments.

The revised wage rates will be implemented starting October 1, following the last adjustment made in April of this year. Minimum wage rates are categorized by skill levels—unskilled, semi-skilled, skilled, and highly skilled—and by geographical area, classified as A, B, and C.

According to the Ministry of Labour and Employment, the new minimum wage rates for area "A" are as follows: unskilled workers will earn ₹783 per day (₹20,358 per month); semi-skilled workers will receive ₹868 per day (₹22,568 per month); skilled, clerical, and watch and ward roles without arms will earn ₹954 per day (₹24,804 per month); and highly skilled workers and watch and ward roles with arms will receive ₹1,035 per day (₹26,910 per month).

The government typically revises the VDA biannually, effective from April 1 and October 1, based on the average increase in the Consumer Price Index for industrial workers over the preceding six months. Notably, retail inflation for industrial workers moderated to 2.15 percent in July compared to 7.54 percent in the same month the previous year, indicating a positive shift in the economic landscape.

The year-on-year inflation rate for June 2024 was recorded at 3.67 percent, down from 5.57 percent in June 2023, showcasing a steady decline in the Consumer Price Index-Industrial Workers (CPI-IW) since February 2024. The all-India CPI-IW for July 2024 also saw a slight increase of 1.3 points, rising to 142.7 from 141.4 in June.