Tuesday, April 8, 2014

Why minimum wage worsens poverty



MANILA, Philippines – Some Filipinos are now willing to work below minimum wage as long as they can earn money.
Based on the law, workers should be given minimum wage to ensure a decent standard of living for them and their families.
However, a study by the Philippine Institute for Development Studies showed that a higher minimum wage actually worsens poverty.
“Generally, (minimum wage is) not only unhelpful but highly detrimental to the welfare of the common man and the disadvantaged,” the report stated.
The PIDS report, Labor Policy Analysis for Jobs Expansion and Development, was written by Vicente Paqueo, Aniceto Orbeta, Leonardo Lanzona and Dean Dulay.
“Based on the findings, Because there’s a minimum wage, it prevents that kind of arrangement to happen,” Dr. Leonardo Lanzona of PIDS, one of the report’s authors, said.
The study says instead of uplifting the lives of poor families, minimum wage actually prevents them from finding a job, leading to a lower household income.

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