Read our column on The Spinoff and RNZ
“There are around 73,000 workers on the minimum wage, or 2.9% of the workforce, according to the most recent Minimum Wage Review, and the truth is the Government’s plan probably won’t be a triumph or a disaster for them. There are risks and there are likely benefits, and some people and some firms will adjust while others won’t or can’t; but perhaps most importantly the winners and losers of the change are likely to come from the same groups within society. To see why, let’s take a little trip through the stodgy heartland of labour economics.
“Everyone deserves a fair shot at life, including a decent standard of living and a chance to participate in society, because we all have equal dignity and value – but we know we don’t all have equal chances or earning power, so we set a minimum wage so everyone can have at least a minimum income. We also know this income has to come from somewhere, usually paid employment, so when we set the minimum we try to make sure we don’t put a dent in the prospects of the employers who create those jobs, especially those who create minimum wage jobs.”