Originally posted by: Minisinghrajput
I agree that forcing companies to pay minimum wage would lead to some adverse effects like putting a hold to any growth plans, some businesses, especially small and medium enterprises may face financial strain due to increased labour cost and companies might start laying off employees to keep their profits in check which would actually lead to unemployment.
But workers' concerns are that India's minimum wage which is ₹176 is insufficient to meet basic needs, especially with inflation and to make things worse it's not even a legal requirement so states can act as they wish. And the International Labour Organization(ILO) have highlighted that fair wages are necessary for economic development and for reducing poverty and inequality. I think it's important for the successful implementation of this policy to consider both, affordability for businesses and ensuring employees well being.
And many economists have also said that Countries which have increased their minimum wage have not suffered from unemployment as a result and many businesses which have increased their minimum wage payout have experienced that higher employee morale have actually resulted into better outcomes for their businesses.
Again, answer to this: market forces. Labor, like everything else, is a function of supply & demand. If supply >>> demand, you have pressure on wages. If demand >>> supply, then that profession turns out to be pretty lucrative. If there were a billion core Java programmers, those people would get paid about as much as household maids
For instance, in Kolkata, where unemployment is still very high, one can't get domestic help below a certain threshold: neither will people come from far away, and within the city, people already know the rates. That forces people who must have such workers to either pay more, or negotiate what services any part-time wages cover. Or let's say that a household needs plumbing services. They can shop around, get a dirt cheap plumbing service and later discover the shoddy worksmanship: that will force them to increase what they'd be willing to pay
On the demand side, the way to get it up is to encourage market forces, w/ de-regulation, to promote more employement. That, and also crack down hard on illegal immigration eg Rohingyas, Bangladeshis,... Once you limit the labor pool to only Indian citizens (and CAA refugees), you have set limits on the supply, and once you boost the demand, you have set the conditions for wages to increase
Only when you have free agents on both sides do you have a win-win situation. Any win-lose or lose-win will, as Steven Covey pointed out, end up in a lose lose
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