Key on youth minimum wage

NZPA report:

Scrapping the minimum wage for young workers could result in people being paid as little as $2 an hour, Prime Minister John Key says.

His comment came after Act leader Don Brash last week proposed abolishing the minimum wage for people under 20, which he said would result in more people working for less rather than fewer people earning higher wages.

Key has said the Government would consider reinstating youth rates, but today raised issues with Dr Brash’s more radical proposal.

The proposal would result in “very low wage rates” and some companies would hire people for as little as $2 an hour, he said.

Actually for many young people there already is no minimum wage. It doesn’t apply to those aged under 16. So I disagree with the PM that moving the minimum wage coverage from 16 to 18 would lead to lots of people working for $2 an hour. Are there many 15 year olds working for $2/hour?

Incidentally when I was at 14, I did get a job for $2/hour. Now today that is worth $7/hr, but regardless is still around half of the minimum wage. It was working at Woolworths cleaning rubbish bins out etc during the week and doing checkouts on Friday night. Having an after school job was great in terms of learning the value of work.

Today no one would be on $2/hour because the welfare system sets a de facto minimum wage of around $4.50 an hour.

Incidentially if it is so wrong to have different minimum wages, based on age – then why it is okay to have different dole payments based on age?

An 18 and 19 year old gets paid less than a 20 – 24 year old by around $37 a week, if both live at home.

And a 25 year old gets paid $38 a week more dole than a 24 year old on the dole.