atans1

Minimum Wages: Yikes! PAP may be right!

In Economy on 17/10/2010 at 5:55 am

The economic case for this isn’t as “open and shut” or the “no brainer” that RP, SDP and Tan Kin Lian make it out to be.

Recent academic research can be cited by NTUC minister and other ministers to prove that having a minimum wage increases unemployment. [Warning: the research is extremely dry and boring, as following the links  will show]

Wonder if Dr Chee, Tan Kin Kian, KennethJ etc have been keeping up with the latest academic research on this issue? I’m sure NTUC and MoM ministers would have been briefed by their staff on the evidence supporting the meanness thesis, sorry the “Being cruel to be kind” thesis.

Improving Workfare must be surely better? http://atans1.wordpress.com/2010/10/13/minimum-wages-missing-the-point/

BTW, I must thank Yawning Bread for changing my views on Workfare. I had confused the meanness with which it is implemented with the soundness of the principles behind it. Stupid me.

http://yawningbread.wordpress.com/2010/09/26/in-principle-workfare-is-better-than-minimum-wage/ put me right on the soundness of Workfare.

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  1. Minimum wage causes an unemployment problem when many workers are employed in jobs that pay salaries below living wage. Obviously, if 30% of our workforce is paid $400 a month and we need to raise the minimum wage to $1500, there will be business that “can’t make it” and fold up resulting in unemployment.

    Minimum wage is implementable if the income gap is not so wide …and we are tackling the 5% or so workers at the margin with minimum wage… ultimately the income gap is the problem and we need to get the pre-requisites in place for minimum wage.

    The fact that the govt is unable to implement minimum wages merely confirms that there are numerous workers that are earning salaries way below the living wage.

    Really how do we move forward from here? How do we encourage businesses to invest for higher productivity to create better paying jobs?

    Past policies that ignored the income gap and simply aim for GDP growth got us here and now it is not so easy to fix.

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