A minimum wage of R4,000 will seriously hurt South Africa: Economist

Pitbull

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I don't see how though. It stimulates spending. Employers will update their prices to cover the added costs. So we'll be where we are now... It's counter productive yes, but I can't see it being a downfall or a negative. Just an unnecessary exercise.
 

ToxicBunny

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I don't see how though. It stimulates spending. Employers will update their prices to cover the added costs. So we'll be where we are now... It's counter productive yes, but I can't see it being a downfall or a negative. Just an unnecessary exercise.

It will send unemployment through the roof, so you will have considerably less people earning R4000.
 

konfab

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Increasing the minimum wage to R4k per month would only benefit the country as a whole if we were not such ferocious importers. In that increase were solely spent on local goods, it would alleviate poverty for the entire country.

This wouldn't happen here. All that would happen is a bunch of Chinese, Indian and Pakistani importers would suddenly be better off.
 

TPM

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Govt needs to regulate food prices, even processed food and other items that are required to live a reasonable life.
We get ripped off. Prices increase but seldom decrease e.g. why does fried chips cost so much? ie. potato prices have been kept artificially high just like a lot of other goods.
 

The_Assimilator

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I don't see how though. It stimulates spending. Employers will update their prices to cover the added costs. So we'll be where we are now... It's counter productive yes, but I can't see it being a downfall or a negative. Just an unnecessary exercise.

Read the fricking article FFS.

Roodt said moving money from “bad capitalists” to give it to workers who will spend more to stimulate the economy is a bad idea.

This approach is a way to stimulate demand in the economy, which is not needed. “I would argue that we do not need stronger demand in the economy,” he said.

“We have excessive demand in South Africa, which is shown by the country’s very large current account deficit,” said Roodt.

...

Roodt also dismissed the argument that a minimum wage will decrease inequality. He said the reason for inequality in South Africa is because so many people are unemployed.

A higher minimum wage won't fix the most pressing problem, which is unemployment, it will only add to that problem. Fix unemployment and wages will increase accordingly.
 

Nuke

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Govt needs to regulate food prices, even processed food and other items that are required to live a reasonable life.
We get ripped off. Prices increase but seldom decrease e.g. why does fried chips cost so much? ie. potato prices have been kept artificially high just like a lot of other goods.

And where in history has that ever worked out well?
 

Pitbull

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Read the fricking article FFS.



A higher minimum wage won't fix the most pressing problem, which is unemployment, it will only add to that problem. Fix unemployment and wages will increase accordingly.

Please explain to me where I said anything not aligned with the article I read? Please do 't be daft. Read what I typed again, slowly. Think and then respond again...
 

Pitbull

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It will send unemployment through the roof, so you will have considerably less people earning R4000.

If prices stay the same yes. It will not though as production costs will increase and passed to the consumer who will just pay more since they earn more. This only affects the people above minimum wage as they get no salary adjustment and prices increase.

So in essence you **** over the current tax payers yes. I see why the Ass got his panties in a knot.
 

konfab

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Govt needs to regulate food prices, even processed food and other items that are required to live a reasonable life.
We get ripped off. Prices increase but seldom decrease e.g. why does fried chips cost so much? ie. potato prices have been kept artificially high just like a lot of other goods.

Worked brilliantly in Venezuela.
Shortages occur in regulated products, such as milk, various types of meat, chicken, coffee, rice, oil, precooked flour, butter prices; and also basic necessities like toilet paper, personal hygiene products and medicine.[1][4][5] As a result of the shortages, Venezuelans must search for food, occasionally resorting to eating wild fruit or garbage, wait in lines for hours and sometimes settle without having certain products
https://en.wikipedia.org/wiki/Shortages_in_Venezuela

The problem is real enough though, food prices are high and people are feeling the pinch. The solution is for the government to work with the farmers in helping to increase their yields so that they can reduce the prices. What they do is the exact opposite. Farmers in this country are seen as the most villainous members of society according to the ANC, EFF and all the black civil society groups.

http://www.timeslive.co.za/thetimes/2014/08/01/farms-are-dying

Food prices will drop when there is abundance.
 

ToxicBunny

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If prices stay the same yes. It will not though as production costs will increase and passed to the consumer who will just pay more since they earn more. This only affects the people above minimum wage as they get no salary adjustment and prices increase.

So in essence you **** over the current tax payers yes. I see why the Ass got his panties in a knot.

So you basically destroy the middle class purchasing power so that a few more people can earn minimum wage? Sounds like a totally legit idea to me.
 

Pitbull

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So you basically destroy the middle class purchasing power so that a few more people can earn minimum wage? Sounds like a totally legit idea to me.

I don't agree with it as obviously the middle class will suffer in the short run. In the long run it all even out again, minimum wage workers will exceed their means again and we're back to square one.

This happens every time minimum wages are adjusted. We just addapt and move on.
 

ToxicBunny

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I don't agree with it as obviously the middle class will suffer in the short run. In the long run it all even out again, minimum wage workers will exceed their means again and we're back to square one.

This happens every time minimum wages are adjusted. We just addapt and move on.

Except you are looking at an average doubling of minimum wage... That type of increase in prices will destory the middle classes purchasing power in the short term, and they will pretty much never recover.
 

Gaz{M}

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I think a blended approach is needed. Yes, many workers probably deserve to earn more, but there are some sectors that have a huge excess of labour. e.g. domestic workers, bricklayers, gardeners, cleaners etc. That is why sectoral wages make a lot of sense.

Are you saying that if a minimum wage was implemented, I would not be allowed to have a domestic worker or gardener unless I pay them at least R4000 a month? Many people cannot afford that. So you will have a huge purge of domestic workers and cleaners at smaller businesses.

A larger business can afford to pay an extra R1 million a year for cleaning services, a small business cannot.

We also need a more flexible labour law. Yes, people need to be treated fairly, but I think workers have far too many rights at the moment. It is one of the reasons people don't formalise their domestic workers, as an example. It makes firing them so hard and expensive.

Now what would happen to the guy on the corner of the street who is willing to work for R250 a day doing handy jobs? Is this going to be banned or policed?

Finally, I think small businesses should be exempted from minimum wage laws and VAT should be increased if minimum wage laws come into effect, so that more revenue ends up available for social services, instead of going to other countries for TV's, DSTV, airtime, cellphones, cars and other basic imports.
 

Ryansr

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Sounds like yet another tick on the list of requirements to finally move to communism.
 

NarrowBandFtw

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I think a blended approach is needed. Yes, many workers probably deserve to earn more, but there are some sectors that have a huge excess of labour

Amen to that, we can solve the excess of labour with the use of a blender! :twisted:
 

WaxLyrical

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Let's just go the China route. Stuff minimum wage and make sure everyone is employed.

A hard worker worth his salt will soon be earning above the proposed minimum wage.
 

Diplos

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Economic 'growth' has been revised to zero percent for SA.

Slicing a pie in a different way is not going to keep the hungry at bay when their numbers are continually increasing, you HAVE to grow the pie, something the ANC seems completely incapable of doing.
 
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