Ireland has one of the highest and most valuable minimum wages in the world, according to a study by HR company Moorepay.
It found that the €13.50-an-hour basic legal pay rate ranks as the sixth most valuable globally.
But is this rate too high to sustain? Financial advisor and analyst Karl Deeter questioned whether the current minimum wage is doing more harm than good.
“I wouldn’t say it’s great news because really what I want to do is make sure that we have a vibrant jobs market where people aren’t being replaced by machines,” he told Newstalk Breakfast.
“Expensive machines are cheaper than a high minimum wage.
“About 30 or 40% of people don’t even pay any tax because they don’t earn enough.
"You have this thing that people say, ‘Oh, we have to survive on the minimum wage’ - it’s really a misnomer.
“We don’t actually know, when you drill down on a household level, how many people have to survive on just that alone.”
According to Mr Deeter, studies in the US have shown that “when you set a higher and higher bar for entry into the workforce”, the number of low wage jobs decreases.
Man with many bills or invoices and no money. Debt. Alamy 2024However, social policy officer with the Irish Congress of Trade Unions Dr Laura Bambrick disagreed with this assessment.
“We are a healthy, high wage economy,” she said.
“We have high prices and you’re talking about food prices going up an average of five per cent.
“Those minimum wage workers, they don’t pay a separate price for goods and services that the rest of us earning average and above average pay do.
“So, the idea that we should suppress wages out of fear that the machines are coming doesn’t match the reality.”
Dr Bambrick pointed out that the US has one of the lowest rates of global minimum wage, which may influence study results.
According to Mr Deeter, “the vast majority of jobs are actually in small and medium enterprises”.
“They face rising costs that are causing them huge problems,” he said.
Main image: Minimum Wage.
