The European Commission on Wednesday (18 April) published an ideas paper to get Europe’s record number of unemployed into jobs and boost growth, including setting an appropriate minimum wage and shaming member states into improving work rates.
A controversial suggestion is that member states should introduce an appropriate minimum wage. Most member states have a floor wage. Germany and Austria are among those that do not. The Nordic countries have collective bargaining systems for many sectors.
“Setting minimum wages at appropriate levels can help prevent growing in-work poverty and is an important factor in ensuring decent job quality,” says the text.
There is an oblique reference to Germany, which been criticised in some quarters for suppressing wages and thereby dampening Germans’ spending capacity.
“Targeted [wage] increases, which help sustain aggregate demand, might be feasible where wages have lagged significantly behind productivity developments,” says the text…
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- Low Wages and Labor Shortages (jobmarketmonitor.com)