Many economists claim that a national minimum wage in South Africa will entail adverse consequences and inevitably leads to widespread job losses. These arguments offset possible gains from raising wage levels with ensuing rising unemployment in the country.
In a response to an article published in the Business Day citing the German experience as an example for this dynamic, minimum wage expert Dr Gerhard Bosch lays out that the introduction of a minimum wage did not result in job losses in Germany. Instead, he highlights its impact for low-wage earners, how industries affected by low wages actually grew and that overall, the minimum wage improved the quality of jobs. His opinion letter includes valuable insights for the current debate about a national minimum wage in South Africa and can be accessed here.
More information on the national minimum wage as well as fact-based research and policy recommendations on its implementation can be retrieved via the National Minimum Wage Research Initiative.