Essay about Minimum Wage And The Labor Market

911 Words Sep 30th, 2016 4 Pages
Executive Summary

MINIMUM WAGE

The influence of an increase in the minimum wage will have a significant impact on the four features these are labor market, employees, enterprise group and the entire economic output of Australia. It has two positive and negative aspects of the impactions.

The impact of the labor market

Wage is the labor market supply and demand, which can conductor enterprises and individuals of the labor demand and supply behavior of the signal. When the labor demand is less than supply, wage growth will stimulate some synthetic operation, resulting in the increase of labor supply, ameliorate the contradiction between demand and supply; on the other side, declining wages will stimulate the part of workers, out of the labor market, reducing the supply of the minimum wage scheme is the administrative means to increase the interest rate of the state and the government. This is an important way for the government to intervene in the labor market. In a fully competitive labor market, if the minimum wage is higher than the equilibrium wage, the labor supply will be greater than the labor demand; the company is willing to be less than the amount of workers willing to hire workers.

Impact on employees

Based on the level of background and technical knowledge, employees can be allocated into primary, intermediate and advanced workers. For intermediate and advanced workers, the market supply and demand relations mainly determine their wages, so that the…

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