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Minimum wage - should there be any / how high should it be?

 
 
fishin
 
  1  
Reply Mon 21 Jun, 2004 04:34 pm
nimh wrote:
Living costs here are lower than in the US, or in American cities in any case - wages overall in any case are considerably lower here than in the US.


I don't know what the "average" cost of living for the US is. I know when I moved to greater Boston from OK the costs were about 4 times higher.

What is the wage offset if you eliminate the the unreported income in the Netherlands? I know with the company I worked for previoulsy we paid all of our employees in the Netherlands but then we also provided them with apartments and cars which, I was led to believe, is a standard practice in the Netherlands. The employees were more than happy to take the apartment and cars in leiu of wages because they didn't have to pay taxes on it.
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fbaezer
 
  1  
Reply Mon 21 Jun, 2004 05:18 pm
I tend to be realistic on this issue.

Ideally, a minimum wage would be enough for a worker to support himself and his family with some decor. This means a minimum wage should not be hourly, but daily.

But this is no ideal world. The market works, a very few States are able to stop that. Supply and demand are the true rulers.
If the minimum wage is set too high, then many employers will illegally hire workers with wages below that mark. If it's set too low, then very few people will be willing to work for such a wage.

A populist government can set a high minimum wage. It will draw beautifully in the official statistics, but it will be a mirage.
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Foxfyre
 
  1  
Reply Mon 21 Jun, 2004 05:24 pm
Or the better plan is a free market economy where supply and demand is allowed to work. Those who avail themselves of a mimimum wage to get some experience, learn a trade, develop a work ethic will then be prepared to compete for well paying jobs that will support a family. In a free market economy, employers will pay as much as they have to in order to hire qualified people who can do the work. Those who qualify themselves for the better paying jobs will do better than those who just want to get by. In our form of government, there should be room for both the go-getters and the 'just get by' people.

Of course those who stay in school and learn as much as they can and perhaps go on to college will rarely have to work for minimum wage even as a training wage.
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nimh
 
  1  
Reply Mon 21 Jun, 2004 05:28 pm
fishin' wrote:
What is the wage offset if you eliminate the the unreported income in the Netherlands? I know with the company I worked for previoulsy we paid all of our employees in the Netherlands but then we also provided them with apartments and cars which, I was led to believe, is a standard practice in the Netherlands.


Shocked Shocked Shocked

ahem, sorry about that -- lol -- <recovering>

Are you serious? Provided with an apartment by the employer? Those must be some good jobs you're talking about there!

I've never even heard of that ... <intimidated>

Was it an expat thing? I've heard of companies providing housing to expats, when they "import" (highly educated) employees from other countries ... but Dutch employees, provided with an apartment ... damn.

Where do I sign up? Razz

As for a "car from the boss", as we say - i.e., provided by your employer - that does happen regularly - but only for upper-segment jobs (or jobs that involve a lot of travelling I suppose).

For example - to put it in context - I dont know a single person who has the kind of job that would get you a "car of the boss". Hell, my boss doesnt have a "car from the boss" ;-). I once had a neighbour who had, though, she had started some management trainee job, already got a car straight away. Guess it also depends what kind of company you work for.

But yeah, no - none of that would definitely be relevant re: minimum wage earners ...

What low-wage earners do get here, is a modest government subsidy on the cost of their rent - like, when I still was eligible for it, it worked out to about a 10% rent reduction or so.

And of course we have national health insurance - that is, low- and average-wage earners are eligible for a health insurance programme where you pay some 60 euro a month for basic coverage (and 75 euro a month for more comprehensive coverage).
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nimh
 
  1  
Reply Mon 21 Jun, 2004 05:32 pm
Foxfyre wrote:
Out of curiosity, what percentage of your income does the average middle-class citizen of the Netherlands pay in all taxes Nimh?


Hmm ... its gone down a lot last five to ten years ... but I'm sure its still a lot more than what you pay over there.

I'm below middle class - work in the non-profit sector, starters job, I guess I'm somewhere midway between minimum and average wage - and I pay a third of my income in taxes.
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nimh
 
  1  
Reply Mon 21 Jun, 2004 05:38 pm
Oh, update: in Holland, the minimum wage is 7-8 Euro/hour (9$ at current exchange rate) - before taxes. (Minimum wage earners pay taxes too.)

So net it would probably be, I dunno - <guessing> - some 6 euro / 7-7,5 US$ an hour?
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L R R Hood
 
  1  
Reply Mon 21 Jun, 2004 05:39 pm
I'm with foxfyre on this one Smile
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fishin
 
  1  
Reply Mon 21 Jun, 2004 06:52 pm
nimh wrote:
Are you serious? Provided with an apartment by the employer? Those must be some good jobs you're talking about there!

I've never even heard of that ... <intimidated>

Was it an expat thing? I've heard of companies providing housing to expats, when they "import" (highly educated) employees from other countries ... but Dutch employees, provided with an apartment ... damn.


It wasn't just for expats. The company offered apartments and cars to all of our European employees (Milan, Madrid, London, Amsterdam, Rotterdam, Frankfurt, Geneva, etc..) and many of our competitors did too. Maybe it's something that is unique to the International Telecom business... ????
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nimh
 
  1  
Reply Mon 21 Jun, 2004 07:36 pm
fishin' wrote:
It wasn't just for expats. The company offered apartments and cars to all of our European employees (Milan, Madrid, London, Amsterdam, Rotterdam, Frankfurt, Geneva, etc..) and many of our competitors did too. Maybe it's something that is unique to the International Telecom business... ????


Wow, I'm impressed. Yeah, no idea. Never heard of a Dutch company offering employees apartments before. Must be some pretty good jobs ...
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Craven de Kere
 
  1  
Reply Mon 21 Jun, 2004 07:40 pm
I voted no minimum wage (for America, in other countries I think raising the minimum wage is one of the most important things they can do).
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L R R Hood
 
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Reply Tue 22 Jun, 2004 06:40 am
If the minimum wage were raised very high, what incentive would people have to get an education and better their lives? Wouldn't it just dumb down America even more?
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nimh
 
  1  
Reply Tue 22 Jun, 2004 06:55 am
LRRHood, countries that have a minimum wage include more or less every member state of the European Union except for Britain. And education level in Sweden, Austria, Belgium or Denmark is not exactly shockingly low. In fact, fewer high school dropouts here than in the States.
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L R R Hood
 
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Reply Tue 22 Jun, 2004 07:09 am
But those countries have a very differend educational system than we do in the US.
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nimh
 
  1  
Reply Tue 22 Jun, 2004 07:14 am
I'm sure every country has a system of its own. But it does mean that one can easily have a minimum wage without it discouraging people to get an education.
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Anoxia
 
  1  
Reply Tue 22 Jun, 2004 10:44 am
Raising the minimum wage just causes inflation, so it doesn't really help anyone.
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nimh
 
  1  
Reply Tue 22 Jun, 2004 04:11 pm
How would raising the minimum wage, in particular, increase inflation?

I mean, all wage increases risk increasing inflation. But since the minimum wage involves least money of all, wouldnt the effect on inflation of increasing it also be relatively limited (compared to more up-market wage increases?)

The minimum wage has been frozen since 1997. The average wage, let alone above-average wages, have meanwhile increased markedly. Why should it be the poorest, of all people, to "unilaterally sacrifice" themselves for inflation, when they'd actually contribute least to it?

Inflation has occurred, even if of modest scope, the past few years, and that has meant that the minimum wage has decreased in buying power.
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L R R Hood
 
  1  
Reply Tue 22 Jun, 2004 07:04 pm
Actually, I've heard a lot of people say the same thing about inflation. People who made minimum wage in the 70's weren't any more poor than the people making minimum wage now, right?... but the value of the dollar has gone down every time that minimum wage has been raised.
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fbaezer
 
  1  
Reply Tue 22 Jun, 2004 07:19 pm
L.R.R.Hood wrote:
the value of the dollar has gone down every time that minimum wage has been raised.


If this happens, it has more to do with psychology that with sound economics.

If most of the wage earners were paid the minimum and most of the commodities in the economy were labor-intensive, then obviously a rise in the minimum wage would have tremedous impact on costs, which would be turned to the consumer (and the dollar "value").
This is not the case. Most wage are a lot higher than the minimum and most commodities are capital-intensive.

So, how can a raise in the minimum wage affect all prices? Only if the minimum price of labor is considered by economic agents as a signal of the way prices should be. In that case, commodities will be more expensive, regardless of the change in costs.
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L R R Hood
 
  1  
Reply Tue 22 Jun, 2004 07:33 pm
I disagree.
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cicerone imposter
 
  1  
Reply Tue 22 Jun, 2004 07:47 pm
roverroad makes the most sense to me; we need minimum wage to protect those workers that will be paid less otherwise. I live in Silicon Valley where the 'average' salary runs about $65,000. That's over $30 per hour. I don't think anybody making $7 per hour can make it in our area without shared living and/or other sacrifices. I wouldn't mind seeing the minimum in our area at $10 or more. My wife and I eat out quite frequently. I usually leave between 20 and 25 percent tip, because I know that those working in the food industry are not paid all that well. If I get poor service, I leave 10 percent. If the food is bad, I complain to the waitress/waiter, and tell them what's wrong with it. They usually replace it.
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