Saturday 20 January 2018

Hitting lowest paid just doesn't add up

CUTTING the minimum wage is nonsense economically. Reducing wages would at best do nothing for employment; more likely it would do the opposite.

Here's how the fallacy works: if some subset of the workforce accepts lower wages, it can gain jobs.

If workers in the car industry take a pay cut, this will lead to lower prices of cars relative to other things, so people buy more, hence more employment.

Please sign in or register with for free access to Opinions.

Sign In

Promoted Links

Today's news headlines, directly to your inbox every morning.

Don't Miss