July 15th, 2010
02:55 AM GMT
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Hong Kong, China – This week lawmakers in Hong Kong are debating if the city should institute its first-ever minimum wage.  Most other parts of the world, including mainland China, have enacted laws requiring companies pay employees above a certain amount on an hourly, daily or monthly basis.  However, despite calls dating from more than a decade ago to establish a minimum wage here, Hong Kong still has no pay floor.

Businesses have long argued that a minimum wage would hurt Hong Kong.  Paying higher wages, the argument goes, could force companies burdened with high investment costs to shut down.  Inflation could get out of hand.  The city might lose its competitiveness or its reputation as one of the freest economies.  On the other hand, a minimum wage could help address Hong Kong's widening income gap between the rich and the poor - one of the world's most egregious.

The lawmakers are expected to pass the minimum wage bill, but the tricky part will come later – deciding the level at which to set the standard.  Labor activists want the equivalent of US$4.25 an hour, a wage they say would better offset the high cost of living here.  At that rate, an estimated 17 percent of Hong Kong's workers would get a pay raise.  Trade groups though argue about US$3 would be more reasonable.

In Hong Kong, US$4.25 can buy you a bowl of shrimp noodle soup or a fancy cup of coffee at your local Starbucks.

In your country, what is a fair floor price for an hour of work?

Filed under: Business


soundoff (3 Responses)
  1. Dan

    A minimum wage will never reduce the wage disparity between rich and poor, but it can reduce availability of entry level jobs and can make it more difficult for new workers and the untrained/unskilled to enter the work force.

    I've been in business for many decades and the unfortunate truth is that far too many people lack sufficient skills to be worth the US minimum wage, so–like other employers–we simply do not hire them. But, if we could hire them at less than minimum wage, we might be able to help them develop the skills necessary to be more productive and worth a higher wage.

    Like most business people, I have no aversion to paying my employees higher wages, but I have to balance the value of the work they produce versus the wages they are paid. If they could all generate $200,000 of revenue per year, I would most happily pay them $100,000/year. But if they can only generate $20 worth of usable work in a day, I cannot and will not pay them minimum wage to do so.

    July 19, 2010 at 8:38 pm |
  2. Oladipo Akinyemi Omole

    Hello Eunice,
    In Nigeria where I reside, workers are paid monthly, but the Nigerian Labour Congress has not been able to negotiate a mutually acceptable minimum wage for workers with the Federal Government of Nigeria.That's the status quo now.
    However , I must say that in a city like Hong Kong with a pool of highly skilled workers( be they craftsmen or artisans) US$4.25/hr minimum wage is too poor.Workers should be paid better than that.
    A higher minimum wage would help firms in Hong Kong to stay competitive and workers would not migrate to other cities with better deals for them. It's a matter the authorities in the city or China as a whole should give quality attention.China nay Hong Kong has a skilled labour force and their remuneration should not be based on a hunch, but a methodically determined process.They should take a cue from other economies like the UK , the United States and others who pay higher. Has it run them aground?
    For Chrissake workers deserve more than noodles.

    July 24, 2010 at 3:46 am |
  3. ash

    @ Dan, Is it wrong morally and ethically for a person not be entitled to a descent minimum wage, where they are supervised in a profit generating business environment?
    Dan makes the point that if workers generate "$20 worth of usable work in a day", they should not earn the right for minimum wage. Valid point. In this case, it would be fair to say it is probably not a proper business, or at best probably a pet/ hobby driven project.
    But, I would make the point then that one should take a closer look at the leaders of the organization to see what they are earning from the labor of it’s workers. Is the supervisor or business leader generating $40 (example) worth of income on this person for $20 worth of work. I would bet that in most/ all cases this is not the case. I would even go so far as to say that the employer is probably earning four or five times more on the individual to support a lifestyle.
    You also make the point that employers could benefit by helping to upskill these people. This to me is perhaps one sensible solution, and perhaps could fall into a separate time-limited category so that it is not open to abuse by unscrupulous entrepeneurs.
    From my own experience, I used to work for such a company, where we were lead to believe that our efforts were not worth much, and believe me the value of our efforts far exceeded what we earned in hindsight, especially so, when after a few years we see how much our efforts contributed to the boss and families lifestyle.
    I believe there is too much focus on ‘I won’t pay more’ rather than ‘I should pay what’s fair’.
    RE Oladipo's statement: ' For Chrissake workers deserve more than noodles'. With hand on my heart, I could not agree more with you.

    July 30, 2010 at 1:05 pm |

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