Karachi, June 26, 2025 – A storm is brewing in Sindh’s industrial heartland as the SITE Association of Industry (SAI) has raised serious red flags over the provincial government’s dramatic move to hike the minimum wage to an unprecedented Rs42,000.
The announcement, made by Chief Minister Syed Murad Ali Shah, has sparked alarm among industrialists who warn of devastating consequences for already struggling businesses.
SAI President Ahmed Azeem Alvi has issued a blistering statement condemning the decision, saying that the enhanced minimum wage is simply “impossible to implement” in the current economic climate. “Industries are suffocating under the weight of soaring utility costs and operational hurdles,” he stated, adding that many units are teetering on the brink of shutdown.
The proposed Rs42,000 minimum wage—up from the existing Rs37,000—would make Sindh the province with the highest wage floor in Pakistan. SAI argues that this 14% jump in wages, compared to the current 6% inflation rate, is not only irrational but also economically unsustainable. “This exaggerated wage spike,” Alvi warned, “could be the final nail in the coffin for many manufacturing businesses already battling survival.”
The implications of this wage hike go far beyond basic salaries. Contributions to SESSI, EOBI, and other statutory levies are calculated on the basis of minimum wage, doubling the financial pressure on employers. “When the minimum wage goes up, every associated cost inflates dramatically,” Alvi explained, calling the move a backdoor blow to industrial viability.
In a bid to salvage the situation, the SAI has proposed a more “realistic” wage adjustment—suggesting that Rs40,000 would be a manageable compromise. However, the association has simultaneously demanded strict enforcement of the existing minimum wage laws, highlighting rampant non-compliance by many employers and the government’s failure to implement its own regulations.
With tensions rising between policymakers and manufacturers, SAI warns that this aggressive wage policy could spark a crisis in Sindh’s industrial zones, risking mass layoffs, shutdowns, and a deeper economic slide. As the debate intensifies, all eyes are now on the Sindh government’s next move.