The Guardian 30 March, 2005

The wages of greed

Treasurer Peter Costello’s rationale for attacking minimum wage families has been blown out of the water by government figures demonstrating Australian job growth ahead of that in the US. Treasurer Costello and Coalition cohorts, including the Prime Minister and Workplace Relations Minister, want a brake applied to the minimum wage on the grounds that it costs jobs.

Government figures released this week show that Australian employment has grown at three times the rate of low-minimum wage rate countries like the US.

Analysis of movements over the past five years shows the Australian minimum wage has risen 2.9 percent, in real terms, while the US figure has fallen by nearly 12 percent.

Over that period, Australian jobs grew by 10.4 percent, while the US could manage only 2.9 percent. UK jobs growth, during a period of rapid minimum wage increases, has also outstripped the US.

The US minimum wage, US$5.15 (approx A$6.60) an hour for adults, hasn’t moved for eight years and has been cited as a factor in the burgeoning growth of that country’s working poor. In the state of Kansas it is only US$2.74 an hour and, in Oklahoma, employers of less than 10 people can pay US$2 an hour!

Now the Howard government’s raft of anti-worker laws — outlawing strikes; restricting unions; sidelining industrial relations commissions; legalising unfair dismissals; stripping awards; and changing minimum wage criteria — is taking Australia down the US track.

The government claims strong employment growth since last year’s Industrial Relations Commission (IRC) award of a $19 minimum wage increase.

The government told the IRC the economy could stand no more than a $10 rise but that evidence was dismissed and, according to its own figures, jobs have grown another two percent since the increase became effective.

Meanwhile, 7.4 million minimum and low-wage workers in the US missed out on a raise for the eighth year straight when the US Senate last week voted 46-49 against raising the minimum wage rate from the current $5.15 an hour to $7.25.

A Republican amendment that called for an 80-hour, two-week work period in exchange for a $1.10-an-hour increase was also defeated.

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