1. Current Minimum Wage and Living Wage Discrepancy:
- As of 2023, Ireland's national minimum wage is €11.30 per hour. However, the Living Wage Technical Group has calculated the living wage to be €13.85 per hour. This gap indicates that the current minimum wage is insufficient for workers to meet basic living costs.
2. Boost to Consumer Spending:
- A study by the International Labour Organization (ILO) found that increasing the minimum wage boosts the income of low-wage workers, who are more likely to spend their additional earnings, thus stimulating local economies.
<
… Read morep>3. GDP Growth:
- Research by the Economic Policy Institute in the US suggests that a higher minimum wage can lead to GDP growth by increasing the purchasing power of consumers. A similar effect is expected in Ireland, potentially increasing the overall economic output.
4. Poverty Reduction:
- According to the Central Statistics Office (CSO), around 12.8% of the Irish population was at risk of poverty in 2022. Raising the minimum wage can help reduce this rate by providing workers with a more adequate income to cover their basic needs.
5. Improved Health Outcomes:
- Higher wages are associated with better health outcomes. A report by the World Health Organization (WHO) highlights that financial stress can lead to mental and physical health issues. Increasing the minimum wage can alleviate some of these stresses, improving overall public health.
6. Minimal Impact on Employment:
- A study by the UK’s Low Pay Commission found that the increase in the minimum wage had no significant negative impact on employment levels. This is supported by similar research in the United States and other OECD countries.
7. Reduced Employee Turnover:
- According to the Institute for Employment Studies, higher wages reduce turnover rates, saving businesses the costs associated with hiring and training new employees. This can improve productivity and stability within companies.
8. Increased Productivity:
- The OECD has found that higher wages can lead to increased productivity as employees are more motivated and engaged in their work. This can be beneficial for businesses, countering the argument that higher wages increase costs disproportionately.
9. International Comparisons:
- In Australia, where the minimum wage is significantly higher than in Ireland (€15.32 per hour as of 2023), unemployment rates remain relatively low, and the economy is robust. This suggests that higher minimum wages can coexist with healthy economic performance.
10. Case Study - Germany:
- Germany introduced a national minimum wage in 2015 and subsequently increased it. Studies by the German Institute for Economic Research found that this led to higher incomes for low-wage workers without causing significant job losses.
11. Equality and Social Justice:
- Raising the minimum wage is a step towards reducing income inequality. According to the European Commission, Ireland has a relatively high Gini coefficient (a measure of income inequality). Increasing the minimum wage can help create a more equitable society.
12. Reduced Reliance on Social Services:
- Higher wages mean fewer workers need to rely on social welfare programs. This can reduce government expenditure on these programs, allowing funds to be reallocated to other areas of need.
By highlighting these economic, social, and empirical points, along with real-world examples, the case for raising the minimum wage in Ireland becomes more compelling. The potential benefits for workers, businesses, and the broader economy make a strong argument for increasing the minimum wage.
