November 21, 2006
I was wondering how a minimum wage would affect the job market.
I have not read any economic theory by any professor. Just a layman’s view:
Workers get more pay. Good for the worker and his family.
Will this result in better morale among workers, increased productivity, lower rate of job turnover, higher service standard, attracting higher-quality workers. Not necessary. I think all these are debatable.
For employers, they might hire fewer workers. Workers will find it more difficulty to get jobs, especially the lower-skilled workers. Then, since it is the same wage, some employers might replace their existing workers with better-qualified ones. Some workers might lose their jobs. I think all these are quite possible. No?
I don't know whether it will affect foreign companies intending to set up shops or how it will affect small businesses.