The Kerala government has announced a 5% increase in wages for contract and daily wage workers as part of its 2026–27 state budget, Finance Minister K N Balagopal said on Wednesday. The raise aims to enhance the earnings and living standards of informal sector workers, who make up a large segment of the state’s workforce.
The budget also includes targeted increases for other groups, such as a ₹500 monthly bump for ayahs in pre-primary schools and a ₹1,000 wage increase for SC/ST promoters. Additionally, funds have been allocated for healthcare needs, including ₹30 crore for medicines for spinal muscular atrophy patients, and infrastructure projects like an international yoga research centre in Kannur.
Despite a reduced net borrowing ceiling imposed by the Centre, Kerala plans to maintain robust social spending within a projected ₹1.95 lakh crore expenditure, balancing fiscal prudence with welfare priorities. The wage hike is expected to directly benefit thousands of workers and underscores the government’s focus on inclusive budgetary measures.
