Korean Job Discussion Forums

[kingpin]

I am not (as will be painfully evident here) an economist, nor do I pretend to take a position on this issue. The truth is, I've always taken the benefits of a minimum wage law for granted, but I've been thinking lately about the matter of minimum wages and the ways in which they're determined. Fortunately, we have on this board people from a number of countries, which should provide for a wide range of viewpoints. So please, give us some of your opinions.

A couple questions I've been pondering...

* How does a government go about determining a minimum wage? That is, assuming we all agree that such a policy is necessary to reduce poverty, why stop at, for example, $6/hour? Why not $12/hour? Wouldn't the latter be twice as good?

* Governments (generally) don't set minimum prices for products/commodities, so why should people be guaranteed a minimum price for their labour?

*What is the overall effect on employment numbers, if any?

As always, I'd appreciate any opinions you'd care to share, but would especially appreciate links/references to statistics and articles on the matter. Any specific info on your own home country's policies might also be interesting.

[Ilsanman]

To respond to just 1 point, a minimum wage is set as a living (snicker) wage but also not so high that it forced mass inflation and makes small business impossible to stay in business.

[thepeel]

Governments set a minimum wage based upon their reading of CPI data, information of who is likely to work at the wage and the the nature of the job (is it a testing wage, for example).

There is quite a lot of debate about this topic. Generally, it is thought that the minimum wages knocks the absolutely least skilled out of the employment market as they are not worth the wage, in the eyes of the employer. However, this is generally regarded to be a very, very small number. A sensible minimum wage will only slightly increase inflation/unemployment.

Also, the minimum wage pushes some labour into the black market. In the United States, it also causes illegal immigration (the comparative advantage of many illegals is that they work for below the minimum wage).

The minimum wage does cause some inflation and some unemployment but the effects are tiny, provided the wage isn't set too high.

[CasperTheFriendlyGhost]

Interesting topic. Should I pay 5 cents more for my burger if it keeps the cook from selling drugs on the side?

Not if I like drugs!


If you're working for minimum wage, then you're being exploited. For most higher wages too.

The problem is that capitalism sucks, but it's better than just about any other workable system. We can't all live in Sweeden.

[thepeel]

If Sweden calculated unemployment the way the United States does, her figure would be in the area of 15% according to the consultancy McKinsey.

Sometimes things are not what we are told.

[pesawattahi]

Yeah and Sweden has as many responsibilities and influence in this world as an 8 year old child. If a tiny country wants to go along on whatever their imperfect system (since we are all merely humans we're going to keep coming up with these imperfect systems some less perfect than others) then they can go right on ahead.

Minimum wage should be done at the state or even region or town level if it is to be done at all. The largest living expense will almost always be housing and some areas are more expensive than others. Especially in recent times with the semi artificially inflated prices.

For example it is outragiously expensive to live in (overrated) San Francisco, but in North Dakota you could basically squat and get a place.

[ChopChaeJoe]

Hey, if you can't find work in sweeden, screw it, just go on the dole. Plus, health care and education are free.

Then again, who wants to live with a bunch of vikings?

Working for min wage either means you're a kid or a loser. I have no time to worry about either.

[browneyedgirl]

Whenever minimum wage is increased then there is a small portion of businesses that go under because they can�t make a profit (there�s an economic term for it, but I don�t feel like pulling out my macroeconomic book) or those businesses turn to illegal workers (like in the US).

If a business uses illegal workers when a minimum wage is increased they always pay the workers less than what they would have paid a legal worker, so the businesses sometimes make even more money than before the wage increase.

[Bryan]

[RobWest]

My first job was as an usher at a movie theatre-minimum wage=$1.85.
I could buy three packs of Marlboro's for an hour's work. Then, my habit was 1 1/2 packs a day. Two if I was boozin'.

I haven't been home in two years, but is'nt minimum up around $6 an hour? So with my 2 to 3 pack a day habit, the first two to three hours of each shift would just cover my smoking.

Then there is food, transportation, shelter, utilities. God forbid there are also diapers, formula, school books and clothes or medicine to buy.

If minimum wage were raised to $20 or $30 an hour, inflation and over-taxation would be right behind to negate the gain.

Even baby sized increases in minimum wage produce double or triple the difference in inflation because most unions have deals where their members always earn either a percentage, or a set amount, over the minimum wage increases. Look where that thinking has gotten Detroit.

[Ya-ta Boy]

What's the current minimum wage here in Korea?

[Hanson]

I'm not so sure there even IS a minimum wage here...

[ChopChaeJoe]

If a company can't survive paying people crap minimum wages it shouyln't be in business at all IMHO. Inflation is fairly meaningless in a world of fiat money. Poverty is not.

[Ya-ta Boy]

[Ilsanman]

I heard it's 3,300 an hour or so.

Lots of shit jobs work you super long hours and pay monthly salary, so it works out to less than minimum wage if divided by hours worked.