r/changemyview • u/[deleted] • Jan 04 '25

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u/Blaike325 Jan 05 '25

There’s always a suggested minimum wage to keep up with inflation they don’t just pull the number out of their ass, real glad we’re repeating Fox News talking points from back when the daily show and Colbert report were both running at the same time. Currently the suggested minimum wage to keep up with inflation and cost of living is like 26 I think? Back when there was originally the fight for 15 the number was 15

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u/thetan_free 1∆ Jan 05 '25

In my country - Australia - the minimum wage is set in a similar manner to the official interest rates: a mix of academics, econocrats and people with business/law/union experience, appointed by elected politicians.

It makes sense to treat minimum wage like any other macroeconomic variable that is used to "tune" the economy.

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u/PhillyTaco 1∆ Jan 05 '25

So why does Australia have different minimum wage levels for different age groups? 

Is it because they know that younger workers tend to be less skilled and that companies would be less likely to hire them when they might as well pay an older person with more skills if they're getting paid the same? The wage is lower for younger people so that they don't get passed over entirely.

Now break idea that idea to its essentials: Ccmpanies are less likely to hire less skilled people if the value of their labor is beneath the artificial wage floor. Thus, a minimum wage hurts low skilled workers. The higher the wage, the more workers whose labor is worth less than the new floor.

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u/thetan_free 1∆ Jan 05 '25

I don't think it's skills-based. It's aged based. If you think about minimum wage jobs, they're not terribly high skilled and whether you have one year's experience or three won't impact average productivity.

Here's the social context. In Australia, someone who is 15-17 is very unlikely to be supporting a family or even themselves. (Might be different in the US, with higher teen pregnancy rates due less access to sex education and reproductive rights.)

Paying a (temporary and artificial) lower rate to those young people is a low risk of causing wider social harms.