How would abolishing the Minimum Wage structure impact on the economically disadvantage in Australia?
Minimum wage is a very controversial issue that can have both positive and negative effects on businesses and employees, especially low-income earners. Introduced in 1907 in Australia, it has progressively been increased by various governments and more recently through the Fair Work Commission. It is not unique to Australia with many other countries, particularly those in the developed world having similar practices. Although there some opposing arguments regarding the implementation of a minimum wage particularly in relation to increasing business costs and the potential for loss of jobs, it is clear that the reasons for supporting this legislation are far greater. Not only does it have better long term effects on the economy, but it also reduces government spending as people are less reliant on social security support and their is some connection with the health of younger generations. In Australia there is generally support for the continuation of a minimum wage system, however in America there has been widespread debate on the issue. There has been many who have argued that an increase to the minimum wage will lead to significant job losses as business cannot afford the increase in costs versus the beneficial gains for the workers who can then afford to buy more goods and services in their community, resulting in the generation of more business for the companies.