The SA government lifted the minimum wage for farm workers by 50% to R105 per day, it was announced yesterday.
Farmers will have no choice but to reduce their operating costs somehow to afford the wage increase, or raise revenue in another way to pay for the wage hikes.
One way will be to remove other benefits given to farm workers. Many farm workers live in houses owned by and paid for by the farmer, on the farm. These workers are heavily subsidised by farmers when it comes to housing.
If farmers are forced to pay workers a higher salary, other benefits will be cut. Housing subsidies may be one of the first to go. Farmers may invest to renovate staff accommodation and turn it into guest suites or Bed and Breakfasts, or whatever, to generate an income off the capital.
Many workers may be a lot worse off than they were before, in many instances, as a result of the higher minimum wage.