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Jan - the appropriate wage is that a willing employer can offer and what a willing employee will accept.
Of course employers do not want to pay more than they feel they have to and an employee will want to earn as much as he or she can. That is life and that is actually how the market is regulated and works. But it is nevertheless more complex than that because the supply of willing workers determines how much an employer has to offer alongside the need to get and keep employee with the right skills and attitude they need.
The 'keeping' bit is probably the most important. Once someone has proven their worth they acquire additional value to the employer. It is better and more efficient to retain good people than go for the lottery of finding new people. This is what then drives up wages. There will be competition for those with the skills, experience and attitudes needed by employers. A job changer, in work, is a more desirable prospect than someone unemployed and out of work.
The problem with the minimum wage is that the market is skewed. It may result in a slightly better wage for someone new in a job or with little experience but in some industries they then have no-where to go after that as wage competition is suppressed. The minimum wage becomes a norm what people expect to get in some types of job and that is just not right and healthy for them or a healthy economy.
In work benefits also skew the market. Yes, Ross is right, these help keep wages down and this is wrong.
I, as a businessman, really want more and more people to have decent jobs and income so they can save and invest, needing the services that I am able to provide. I have a real personal and business self-interest in higher incomes for people. This is no different to other businesses. It is the market that will best achieve that, not the minimum wage, not in work benefits.
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