Defining Minimum Wages Advantages

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Introduction Minimum wages policies have always been controversial among economist while some supporters of minimum wages justify them as improving the living conditions of the poor, unskilled, unorganized workers (card and Krueger, 1992) and also reducing income inequality between men and women, between black and white workers. Some analyst pay attention to the fact that the introduction of minimum wages increases the labour market earnings of those employed, while others emphasize that the introduction of minimum wages would normally be expected to reduce the number of employment (Brown,1999; Ehrenberg and Smith, 2006; Borjas, 2005). Minimum wages can make jobs and work to very attractive and pleasant, which may lead to an increase in labour supply which is extremely important for labour industries and decrease in under productivity, increased output per worker low abstentiseem and effectiveness. Defining minimum wages Ehrenbeg and Smith (2006:109) refer to minimum wages as a policy that compels the employers to increase wages paid to all low wage workers. The fact that a minimum wage is a compulsory rate should have an interesting economic effect on such factors as working hours and the workers output The impact of minimum wages on job creation Minimum wages can reduce income equality in South…show more content…
Therefore the adoption of minimum wages by the South African government can be an effective mechanism of reducing income inequality if they can be set fairly without causing major harm for the
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