Advantages Of Minimum Wage

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Minimum wage is the legally lowest wage permitted by law, a common wealth distribution law ensuring all citizens meets the basic standards of living. Since the minimum wage often goes hand in hand with issues of employment and poverty, it’s a topic attracting considerable interest. Different provinces throughout Indonesia has different minimum wages, established with the formula which requires the minimal wage to be adjusted based on accumulation of inflation rate and figures of national economic growth. The minimum wages is determined at the level of province, district, and occupational level; each region has the power to frame their own minimum wage at provincial level and city based/district level. The current minimum wage law in DKI is…show more content…
Jakarta governor Ahok admits that a significant minimum wage hike could trigger higher unemployment rates by harming jobs, which is why he work towards limiting the increase of minimum wage. The higher inflation rate is seen in the old minimum wage determining system which takes no consideration of the national economy’s growth and inflation rate, which is starting to be improved by a new law. The growing competition for jobs is found in the increase of educated workers occupying most labors, replacing what used to the positions for less educated workers. The goal of minimum wage law is to increase job opportunities so more people to achieve basic living conditions in Indonesia. To do this, the government shouldn’t relay on the raise of minimum wage itself as solution, rather they should focus on inequality in job distribution such as the gender wage gap, since the minimum wage’s only applied to 35-45% of the formal laborers (Indonesia Investors, 2016), while the rest are informal or vulnerable (self-employed) workers. Minimum wage shouldn’t be increased beyond the point it’s increasing now (based on its laws), as it would trigger the disadvantages of minimum wage as mentioned above to

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