Facts Support Minimum Wage

Facts support minimum wage

I agree with the views of Gary Collings on the minimum wage ("In defence of a fairer society", January 11). He is right to point out that Britain has not been harmed by minimum wage legislation since its introduction in 1999. In my letter ("Proof in the practice", December 7, 2006), I referred to a report in The Economist which said that the law had worked well in Britain and had not harmed the wage earner or the employer.

I also reminded readers that there has been a minimum wage in the US - the stronghold of market freedom - since 1938, and that most market economies in the world had adopted some form of wage protection policy. I also mentioned a research paper by distinguished scholars on the website of the UN Labour Organisation that said there was no historical evidence that wage protection laws caused unemployment. I am frustrated by the nature of the debate on the wage issue in Hong Kong. Opponents of a minimum wage law just avoid dealing with the evidence that such a law does not damage the economy, and merely repeat nonsensical arguments. Some so-called economists even claim it will lead to a reduction in the demand for labour.

Labour demand is affected by many factors independent of wages. The two-way movement of supply and demand can lead to so many different outcomes, which makes it difficult to blame wage levels for unemployment.

The facts speak for themselves, and it is up to those opposed to wage legislation to answer them.

Joseph Ko, Sha Tin

Well said Sir!

There's far too much of the Thatcherite point of view that any regulation of business is inherently anti-business in Hong Kong. Much of this is relentlessly pushing a corporatist agenda, by attempting to absolve large corporations of any social conscience or responsibility and therefore allowing them to operate unfettered.