Minimum Wage

Minimum wage refers to the lowest, law-mandated hourly, daily, or monthly salary rate that employers should give to their employees and workers. Employers that pay wages lower than the minimum wage recognised by the state or country can be sued due to violation of labor laws. Australia and New Zealand were among the first countries to enact the minimum wage law, which is now being upheld and followed in more than 90% of nation states all over the world.

Minimum wage jobs vs. entry-level jobs

A common misconception among college graduates and even the general public is that entry-level jobs and positions entail minimum wage salaries. While this holds true for some companies and government agencies, not ALL people who hold entry-level positions get minimum wage. The decision of whether to give minimum wage or more to employees depends on the employer and the tasks and responsibilities involved in jobs - may they be entry-level or not.

If an entry-level job involves specialised work and requires technical knowledge, employers usually give more than the minimum wage. Competent employees with relevant background and knowledge are highly valued in the job market. Employers are well aware of the fact that if they do not give workers their due, these skilled and competent workers can easily look for employment in other companies that will recognise their worth and offer them more than the minimum wage.

The debate on minimum wage law

The topic of minimum wage is a much debated one. Supporters of the minimum wage law contend that it's a way of ensuring that employers and workers are not exploited by companies and corporations, while opponents claim that the minimum wage only encourages professional mediocrity. According to minimum wage law opponents, workers will not strive to get higher wages because they feel secure that even if they don't work hard, a minimum wage will still be accorded to them.

Another gray area in the topic of minimum wage is how it's calculated and determined for each and every country. Should the minimum wage be based highly on the specific country or region's cost of living? If so, should the minimum wage rate stay at a level that would ensure subsistence or go beyond that? Should the labor market's supply and demand dictate the rates for minimum wage? Does the minimum wage law really lead to economic justice?

These are just some of the questions that economists, entrepreneurs, legal practitioners and worker unions try to address in minimum wage debates. Despite its flaws and loopholes, it cannot be denied that the minimum wage law benefits a large portion of the workforce.