The issue of the minimum wage has been contentious both prior and post-1994, with a consensus between business and labour unions nowhere near being thrashed out. Interestingly, information from a research coordinated by Dr Asghar Adelzadeh, director and chief economic modeller at Applied Development Research Solutions, commissioned by National Minimum Wage Research Initiative, supports the adoption of a national minimum wage.
The gist of the research’s findings say that the significance of the minimum wage should be understood in the context of macroeconomic variables such as employment, output and growth, and microeconomic variables such as poverty and inequality. In addition, a decent minimum wage would stimulate growth and reduce inequality and poverty through increased spending.
50% of full-time workers earn under R3640 per month, well below the R4125 in wage income that is needed to raise a worker and their dependants out of poverty.
