Among in Organisation for Economic Co-operation and

Among the development country, Australia has the highest minimum wage which had recorded in Organisation for Economic Co-operation and Development. We can clearly see that the minimum wage in Australia is keep raising every year that in 2015, it lifted 2.5% to $17.29 an hour, which is above the inflation 1; raised 2.4% to $17.70 in 20162; which in 2017, a greater increasing occur which is 3.3% to18.29 an hour3. According to Justice Ross, he said that the business conditions is stable and the unemployment rate is positive and also improve the living standards among the low-paid group despite the increase of the wage.

Another interesting is the taxes that need to pay is lower, which totally different with other country that the tax is increasing with the increase of minimum wage. Besides, it is easier for an Australian to live above poverty line which they only need to work six hours per week to who have two kids. However, it seems unfortunate in other country such as United State which is a country that more develop then Australia. A worker there who also has two kids need to work 50 hours per week to lift themselves above the poverty line while if in Czech Republic, need to work 79 hours per week to escape poverty which is 13 times compare to an Australian worker.4

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Many countries have implemented its minimum wage system which every employer is required to follow. It provides a fair and equal hourly wage to every employee; however, lots of arguments rise to oppose this policy. Nonetheless, is it this system brings more problem rather than benefits the society?

The biggest argument arisen against the minimum wage is it ends up with unemployment due to the dropper demand for labour. Due to the extra paying, most employees choose to either increase the prices of their business or cutting down the number of workers or both. According to Daniel Mitchell, who works at a libertarian think tank, called Cato Institute, business just provides work for them who can generate net income to the company instead of charity. Higher minimum wages will cause minorities and young people with limited skills and work experience suffer most. Furthermore, Liebler’s analysis also shows that most employees prefer white youth than minority youth due to the differences in education, culture and background1.As a result, The Centre for Economic and Policy Research had provided a trustable evidence to prove that that is wrong. They come out with a summary of an analysis did by the White House Council of Economic Advisors (CEA) about the effects on raising the minimum wage above $7.25, which is the federal minimum of United State2. Since 2014, there are 18 states in United State hiked the minimum wage and the research did not show that it brings impact on employment or hours worked but helped raise earnings of the low-wage work3. The statistic shows the that states with federal minimum wage hike have similar employment level with other states4. So, these clearly show that minimum wage system did not affect the rate of unemployment but in other hands actually incentivizing work.

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