What should a minimum wage be?

[Hard Rain]

Why? If he is making 10 times that for the company or he is worth that much $$$ why not pay him/her x Million ZAR / year?

Yeah, or how about instead of depersonalizing this issue: imagine you open a business that makes widgets and suddenly your widgets become very popular and your business is booming. Would you be happy if the guavament capped how much you could earn from your success?

 

[VioAdmin]

I don't think you understand the situation or the other posters' comments completely. Forget for a minute about minimum wage and all that. Let's look at how a company works: You have a board of directors and share holders. The board works effectively, for the share holders. If the board decides to enrich themselves, the share holders start losing out and have the choice of getting rid of the parties responsible.
When will the share holders start losing out? When the company starts performing poorly due to, for example, over worked or unhappy staff with low levels of productivity. The board can continue paying themselves massive bonuses while their staff are unhappy, but eventually they're going to get kicked out, or the board can give the employees raises or hire more staff and let the company continue to perform. It's not like the guys at the top aren't held responsible for their actions.

Now, to get back to minimum wages. A basic rule of economics is supply and demand, right? Now, at the moment, two guys both have R10, for example, and they want to buy a bread each. The problem is, there is only one bread. Both of them really want it and whoever's selling the bread knows there's a big demand for it. The seller charges R10 for the bread because he knows he's going to get it and sells it to one of the two guys.
Right, so now minimum wages get hiked up and these two guys now earn R20. They both want to buy a bread. The seller now knows he'll sell it, but since more money's available, he can charge more and he jacks up the price to R20. Did either of these employees gain anything by their salaries doubling? No. If everyone's salaries get pushed up, everything will just get more expensive since that's what retailers can get away with, not to mention the added cost of producing goods due to employees earning more, etc. The increases end up being artificial and inflation goes up.
You cannot artificially alter the supply/demand (In this case skills) relationship with regulations and whatnot and have it be sustainable. In the end, you're just bluffing yourself. Increases only work when a select portion get them, if everyone gets them you haven't achieved anything other than getting more zeros on your paycheque.

Sigh...we all know the guys at the top milk out the bottom and by the time they are held responsible for their actions they are already wealthy and have since retired. Telkom CEO's for example? lol

So what is your idea of a solution for everyone to be happy with what they take home? Why are minimum wage increases implemented in other countries and the other countries seem to "stablize" themselves. Is SA in a rare situation because of the government policy/inflation? Surely we are better off than a lot of places despite whatever troubles? No?

Yes you are right, you can't make EVERYONE have a pay increase, something has to give.

It just seems like more and more people are striking here compared to the other nations(could be wrong?)

What do YOU KNOW that the other countries including SA/finance ministers etc don't know on how to fix this?

 

[WilD_CaT]

Minimum wage doesn't work. Period.

The only way to increase earnings in real terms is to increase productivity across the board (Increase supply relative to demand, prices drop), easiest way to do it is to employ people.

Easiest way to do that is do away with minimum wage, and whilst we are at it, all other regulations that increase the cost of hiring people.

 

[Messugga]

What do YOU KNOW that the other countries including SA/finance ministers etc don't know on how to fix this?

I wish I had a quick fix solution, but I don't. The first step would be to create more jobs and get as many people employed, educated and off of the welfare system, as possible. To achieve that, however, government would have to alienate the majority of their voters, which they're obviously not willing to do. What I do know, however, is that things cannot continue as they are currently. We're heading towards a very steep cliff.

 

[VioAdmin]

I wish I had a quick fix solution, but I don't. The first step would be to create more jobs and get as many people employed, educated and off of the welfare system, as possible. To achieve that, however, government would have to alienate the majority of their voters, which they're obviously not willing to do. What I do know, however, is that things cannot continue as they are currently. We're heading towards a very steep cliff.

True...unfortunately.

 

[Hard Rain]

I wish I had a quick fix solution, but I don't. The first step would be to create more jobs and get as many people employed, educated and off of the welfare system, as possible. To achieve that, however, government would have to alienate the majority of their voters, which they're obviously not willing to do. What I do know, however, is that things cannot continue as they are currently. We're heading towards a very steep cliff.

There is never going to be enough time to get the bulk of the current workforce "educated" to a standard the proponents of a "living wage" require. They need to start working at anything... anything! to develop some kind of skill-set.

In any case, it always amuses me that people are irritated at the meager social grants, but aren't happy if people work for the same or less in wages? Very strange.

 

[chicken247]

"need to start working at anything... anything! to develop some kind of skill-set. "

Yes!

Start baking a bigger cake by allocating capital efficiently. Bureaucracy only cuts the cake into smaller pieces, it does not bake bigger cakes.

 

[Albereth]

Like they could not possibly have "fixed" bread prices and "cheated" the whole population of SA? .... O wait.

You make valid points but a completely free economy will not work better than a mostly free economy in SA (in my opinion).

We do need a minimum wage but we need to buit the labour unions as they cause nothing but trouble on a grand scale.

Ps my idea of minimum wage is +- R1500 / month. For full time.

The fixing of prices can be a good thing - not usually, but it can be. There is a cost to competition too and those costs get handed to the consumer. Remove that friction and the price may (lol) even come down.

It doesn't matter how low you think your minimum wage is, the whole notion is wrong.

 

[msmoorad]

is it just me or do those who do the least work get paid some of the best wages- esp those represented by unions like Transnet employess & municipal workers- i dont know bout the white collar executives- they r in another league.

i really wont mind getting ANY job at Transnet- i know guys there who do basically nothing & dont even have a std8 cert but they earn R12 000pm without overtime.
plus they get free uniforms & nice Tshirts n jackets etc.

 

[LottaFun]

The more you know how to do, the more you can earn, so it all comes back to education. And as we know, education in SA is almost non-existant.

While we are on this subject, I am looking for a sponsor. I want to build a "trade" centre. The trade centre will have 100 classrooms and can accommodate 5000 students. Each classroom will teach you a different trade (welding, electronics, computers, brick laying, painting and so on). You will be able to learn 100 different types of trades. It will be free to the public, have day and night classes and be more hands-on training than acedemic training. Every class will be sponsored by a company and that company will teach the "students" a specific trade.

Any takers?

 

[zippy]

Minimum wage should be R6500/month at the very least.

The living expenses in SA are getting more and more expensive and South Africa with a GDP over well over 500+ Billion US Dollars[more than places like Ireland and Denmark], there is for sure some money around here to spread.

I don't know how anyone can survive on R1,000/month, not even R3,000 is enough since everyone has like 2 kids+ and there grandmas to watch after.

Raise the minimum wage, I am sure a lot of people who do illegal activities on the side, like taking bribes or simply stealing would stop.

It depends what you mean by "survive". Having a roof over your head and food for your family is the the most important part. The cost of housing varies incredibly. The same structure can have vastly different costs depending on area.

Looking at your numbers from my point of view here in the UK probably isn't fair, but I would have to say that R6500 is probably a fair number. The problem is that I don't think it is achievable in SA in the short term. No economy can survive the increase in minimum wage that is required. It will trigger such an increase in prices, that R6500 will be worth R1000 anyway and all you will have achieved is to make South African exports more expensive in climate of world austerity.

The minimum wage needs to be ramped at a pace the economy can afford, and more effort needs to put in place in vocational training. A substantial part of this be in the form of apprenticeships and on-the-job training. There should be legislation enforcing this with funding from govt.

On the education side, the schools are the biggest disaster. Too many South African kids do not get interact with different races until much later. This leaves them at a massive disadvantage in the workplace, especially black kids.

So far the govt's answer is to force them into the workplace. It's like forcing a square peg into a round hole. A lot of friction. I guess they see it as politically easier to only try to apply force to the previously white part. They are doing these kids a disservice. South Africa is a multi-racial society whether the ANC likes it or not. And it's not just the ANC or the so-called black side of it. I know from personal experience that almost every White person I know is either very, very reluctant or just plain refuses to participate in anything that has enough black involvement that it may overshadow the whiteness. They are happy to have the odd black dude in their midsts. This to me is the sad truth of what is South African society. Of course, both black and white will be able to come up with a thousand reasons why they are what they are, but too few try to find common ground, and that is the failure.

 

[smokey]

If we have minimum wage, shouldn't we also have maximum wage? CEO's and directors earning more than R5 million a year is just plain stupid.

If someone works really hard to get to a certain position, why limit their earning potential?

If someone is too lazy to work properly (at a job they have), why prop up such negative habits?

The fact of the matter is that at ground level - most black people with no high school are educated by the unions in this way...

"You have rights" (while never mentioning the RESPONSIBILITIES of the worker)
"We will protect you no matter what" (ignoring any legitimate claims made by the employer ie: the worker told the boss to "**** off" or "go to hell")
"You can't lose your job, so it's best with us"

Now when you have these influences, it naturally makes people more lazy. You can fight this in one way only - abolish minimum wage. that will teach these people to either work hard or get peanuts as a salary. Simplez.