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by Arthur Reynolds
I think that a slight increase in Austrias minimum wage will help new citizens buy food and survive. I propose that the minimum from 1.5 ATS to 1.7 ATS.
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Comments
When you raise the price of wages artificially, it means that companies will need to raise the prices of their goods in order to pay workers the now higher prices. So while some people will be paid more, they will have to spend more in the market place than previously.
Companies may also need to lay off workers if they still can't pay all of them the higher wage despite raising prices, thus unemployment will grow. Then you will have more unemployed people who are even farther away from being able to afford goods and services, since these goods and services have become more expensive due to the minimum wage increase.
Having a minimum wage at all is a counterproductive concept, and raising it from its already too high level will do Austria no good.
I don't see how reducing the number of job offers for new employees will help them. All companies already take a loss on hiring a skill 0-1.99 worker, and are just hoping that they will stay with the company after they improve their skills. New members can survive just fine, if the choose to. Within 6 days they can be at skill 2 in some industry and can command better wages.
A better proposal would be to reduce the minimum wage to 0 ATS. This would provide maximum employment opportunities for the new citizens.