After reading many arguments for and against minimum wage, I am now against the imposition of a minimum wage.
Being a proponent of a welfare-ish state, I was initially a supporter of minimum wages. I was of the opinion that every worker deserves a decent amount of pay to fund a decent lifestyle.
So, why the change of tone? Its not a policy flip flop but more of a result of being enlightened. No doubt a minimum salary will ensure those in employment are not exploited. But a minimum wage will have the effect of giving fish instead of teaching to fish*.
Why do I say that?
A minimum wage doesn’t take into account the needs of the employee. An unmarried employee would be happy with 600 but an employee with 3 school going children might find 600 far from enough.
A minimum wage could lead to the corporation deciding to automate and eliminating unskilled jobs. The only reason unskilled lowly paid workers are working is because they are cheaper than machines, once they become more expensive than machines, the corporations will have no more need for them.
A minimum wage will kill incentive and effort. A worker previously earning 300 will now earn 600 and he/she will think hey, without doubling my efforts, I’ve doubled my earnings. They will maintain the same productivity and a few years down the road demand an increase in the minimum wage; citing inflation, rising cost of living as an excuse.
So, how do we ensure workers get higher (decent) pay? There may not be a short term solution but a longer term solution would be to increase the education level of the citizens. Improve the education system and make sure the nation produces a lot of engineers, doctors and scientists who are able to develop technological solutions and automate the nation. As a result, menial jobs will be naturally eliminated. We don’t need to pay low wages to the train driver because there won’t be any train drivers. Rubbish will be channelled direct from our homes to the incarcerator, no need for garbage collectors. Road sweepers will need to be highly skilled to operate the road sweeping machine; his wages will be higher by virtue of being highly skilled. Lowly paid security guards will be a thing of the past with the invention of high tech efficient security systems.
No doubt there will still be a need for low skilled office cleaners, roofers etc. but given that the rest of the society will be very well off, paying them a little higher won’t be such a problem …
A minimum wage doesn’t take into account the needs of the employee. An unmarried employee would be happy with 600 but an employee with 3 school going children might find 600 far from enough.
A minimum wage could lead to the corporation deciding to automate and eliminating unskilled jobs. The only reason unskilled lowly paid workers are working is because they are cheaper than machines, once they become more expensive than machines, the corporations will have no more need for them.
A minimum wage will kill incentive and effort. A worker previously earning 300 will now earn 600 and he/she will think hey, without doubling my efforts, I’ve doubled my earnings. They will maintain the same productivity and a few years down the road demand an increase in the minimum wage; citing inflation, rising cost of living as an excuse.
So, how do we ensure workers get higher (decent) pay? There may not be a short term solution but a longer term solution would be to increase the education level of the citizens. Improve the education system and make sure the nation produces a lot of engineers, doctors and scientists who are able to develop technological solutions and automate the nation. As a result, menial jobs will be naturally eliminated. We don’t need to pay low wages to the train driver because there won’t be any train drivers. Rubbish will be channelled direct from our homes to the incarcerator, no need for garbage collectors. Road sweepers will need to be highly skilled to operate the road sweeping machine; his wages will be higher by virtue of being highly skilled. Lowly paid security guards will be a thing of the past with the invention of high tech efficient security systems.
No doubt there will still be a need for low skilled office cleaners, roofers etc. but given that the rest of the society will be very well off, paying them a little higher won’t be such a problem …
* Give a man fish, he’ll eat for a day, teach a man to fish, he’ll eat everyday … or something like that
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