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Essay On Free Market Wage

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Why the free market wage is BETTER! There are many reasons why a free market wage is better than a minimum wage. The debate has raged on for ages but below are four points which we believe shows that a free market wage is the better option.
1. The main argument that the minimum wage campaign puts forward, is that raising the minimum wage will decrease poverty and improve the living standards of more people. BUT……. According to a report dated March 2008, conducted by the Development Policy Research Unit (D.P.R.U) based in South Africa raising the minimum wage will have little to no effect on poverty. In the table 1 and 2 on page 7 the CGE results compare two scenarios. In the first you see a situation with no labour productivity. This shows …show more content…

As opposed to the minimum wage, we believe that a free market wage will be more beneficial for South Africans. The free market wage is calculated as the standard rate paid for skilled labor , which requires education, training as well as a certain amount of experience in a basic area of work.
From an employment point of view free market wages , unlike the implementation of a minimum wage , does not raise cost for businesses nor does it run the risk of increasing an already high unemployment rate in South Africa. The free market wage would encourage people to better themselves through higher education as they will not be willing to settle for just anything and this would then benefit both households and businesses as there will be an increase in the number of skilled workers available and willing to work and increase productivity for businesses thus making it possible for expansion and in turn creating more jobs along with improving the country’s economy.
An increased number of skilled workers would mean a better chance of them finding jobs and also a greater chance of them not depending on social welfare as much, giving government the opportunity of using these extra funds for the improvement of the country’s infrastructure, it could be used to develop the skills of the youth entering into the workforce for the first time and it could also lessen the burden on

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