March 2, 2014

Two dozen countries have higher minimum wages than the US ... (if Compared to wages that are often lower than the US.)

Yahoo's finance blog The Exchange wrote that  Two dozen countries with a higher minimum wage than America’s  That sounds pretty bad that we come in behind 2 dozen countries.   Even worse the article compares the US to 27 OECD nations and we're 26th. 

They say :

Data from the Organization for Economic Cooperation and Development shows the federal minimum wage of $7.25 per hour ranks 26th out of 27 countries, when measured as a percentage of the average wage in each of those countries


I underlined that last bit for emphasis.

The USA has relatively high average wages.   Some of you may scoff at that idea because we Americans seem to be all convinced that we're struggling to make ends meet and that our wages can't possibly be 'high'.   But rest assured we (the richest nation in the world) do in fact have high wages compared to most other nations.

Lets look at  the List of minimum wages by nation and List of average wages by nation
and find an example...

Greece's minimum is $5.19 per hour which is much lower than the US minimum of $7.25.
Greece's average wage is about $1100 a month and the US average is cited as $3693.   
Their minimum wage then is about 78% of the average wage and the US minimum wage is about 33% of our average.   SO by this measure of minimum wage / national average then Greece's minimum wage beats the US minimum wage.  

Would you rather make $5.19 an hour or $7.25 an hour?    I'd prefer $7.25 an hour.    And I don't really think I'd care what % of the national average that figure represents.    How about you?   Would you like to be broke in a broke country or less broke in a well off country?

Now this isn't to say that the US has a particularly generous minimum wage.  We fall behind many industrial nations for sure.   And I can see some of the argument for putting minimum wage in relation to national average since countries with high average wages often have higher cost of living.  But its still just not all that effective of a measure as far as I'm concerned. 

Business Insider compared wages in Here's How America's Minimum Wage Stacks Up Against Countries Like India, Russia, Greece, And France and their graphic shows us coming in behind Australia, Australia, France, New Zealand, UK, Canada and Japan.     

If you sort the List of minimum wages by nation then we come in at 13th in that list among all countries.   If you sort the List of average wages by nation then we come in 16th.

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