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Greece Lags Behind in Minimum Wage, Purchasing Power

Greece is close to the bottom among countries regarding the minimum wages earned by workers, and Greeks have little real purchasing power, according to data from Germany’s Wirtschafts-und Sozialwissenschaftliches Institut (WSI).
Greece’s low ranking is attributed mainly to the economic crisis the nation has endured in recent years. The current minimum wage places Greece alongside countries with chronically-ailing economies such as Brazil and Argentina.
According to the report, the global financial crisis worsened social inequalities in many countries, and support for the lowest-paid workers is a key future goal for several governments.
Talks on raising the minimum wage are in progress all over Europe. In Greece discussions on the issue of minimum wage will commence in January, 2019. In Spain the government recently announced the largest annual increase in its minimum wage in 40 years, rising by 22 percent.
In France, as the result of the pressure from the “yellow vests”, President Emmanuel Macron announced that the minimum wage would soon be increasing. The French protestors were originally demonstrating against fuel taxes which would disproportionately affect rural people, but their numbers now include a broad base of the populace which is angry about all types of economic inequality.
Proponents of higher minimum wages say businesses have a responsibility to pay workers adequately to live, while opponents claim a high minimum wage destroys jobs and hinders entrepreneurship. A report earlier this year by the Institute for Tax Studies warned that raising minimum wages could expose more jobs to automation.
Many workers who earn the minimum wage in developed countries work in the service sector, where it may be easier to pass on wage increases to customers through higher prices. Some companies are not afraid to pay more because higher wages tend to reduce personnel turnover, and they also save on training costs.
The cost of living also impacts minimum wage calculations to a great degree. While the absolute level of wages in the U.S. has increased over the last 50 years, workers are actually poorer because wage increases have not kept pace with inflation.
Purchasing power is also affects living wage calculations. For instance, the hourly wage in Australia equals 9.47 euros of purchasing power, which is six times higher than Russia, where the purchasing power of a worker’s hourly wage is only 1.64 euros.

WSI data, World Economic Forum

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