Pay Rise for Aussies on Minimum Wage
The Fair Work Commission has announced a pay rise for the two million Aussies on minimum wage.
That might seem like a good thing. But the reality behind this decision is bleak.
Russell Zimmerman, executive director of the Australian Retailers Association, is seriously concerned about the effect of these changes.
According to News.com.au, he said:
‘With the current state of retail and store closures we’ve seen over the last couple of months, we don’t believe it’s the correct decision by the Fair Work Commission’.
Zimmermann claimed that this rise would create a situation that is ‘not sustainable’.
While workers may think this is putting money in their pockets, it could end up going the other way entirely.
This Pay Rise Could Cost Aussie Jobs
A raise like this could cost jobs according to the Australian Industry Group. Business Insider also reported that the Group claimed a rise of more than $12.50 would threaten jobs.
The final decision allows an increase of almost double that.
According to that report, The Australian Council of Trade Unions (ACTU) were pushing for a $50 per week increase to the minimum wage. So this compromise could be a small mercy, compared to the damage they could have done.
The new minimum wage, at $18.93 per hour, is already substantially higher than most other countries.
Up until January this year, the federal minimum wage in the United States was just $7.25, and hadn’t changed since 2009.
In the UK, the minimum wage of £7.83 is still significantly below ours, even after taking currency exchange into account.
Australian Employment Rate Falling Behind
Australia is in the top five for gross national income per capita, but our employment rate is falling behind.
Perhaps even more telling, our part time employment rate is one of the highest, behind just two other countries.
Given that our prior minimum wage of $18.28 was still miles ahead of most other countries, it seems selfish to increase that at the risk of falling even further behind on meaningful employment levels.
But if this leads to lost hours or jobs, it could cause a serious drain on our economic resources.
According to ABC News, ACTU secretary Sally McManus said:
‘People who have been forced into poverty by the inadequacy of this wage should not have to wait every year to see if they will be saved by the Fair Work Commission.’
Still, even without the extra 3.5% raise, the Australian minimum wage was already far from the poverty line.
This raise in wages, and the loss of jobs that might follow, could potentially push those people into a level of poverty that is truly desperate.
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