Deutscher Gewerkschaftsbund

Jul 10, 2015
European employment outlook 2015

OECD: minimum wages help the low-paid

Little adverse effect on employment levels

In its employment outlook for 2015, the OECD notes that a minimum wage helps low-paid workers to improve their standard of living. “On their own, however, minimum wages are not a panacea,” said DGB board member Stefan Körzell. He is calling for further action to curb imbalances on the labor market.


According to the OECD, minimum wages help to improve the living standards of low-paid workers. They also have little adverse effect on employment levels, says the organization; close harmonization with national social and tax systems is required to ensure that the poorest in society have the greatest possible disposable income. DGB board member Stefan Körzell welcomed this analysis, noting that the stress on the positive aspects of minimum wages is relatively new stance adopted by the OECD. The analysis “should also act as a wake-up call in Germany to all those who have not yet made peace with this instrument,” said Körzell.

Protective collective bargaining agreements necessary

“On their own, however, minimum wages are not a panacea to curbing imbalances on the labor market,” said the DGB board member. Körzell also demands “tailored support for the long-term unemployed, the containment of temporary work and service contracts, and naturally also protective collective bargaining agreements”.

In Germany, the positive trend seen in the labor market has been sustained, according to the OECD report. Nevertheless, OECD Secretary-General Angel Gurría sees ever more people “trapped at the bottom of the economic ladder”. Governments must act now to prevent a sustained increase in the number of people stuck in long-term unemployment or moving between unemployment and low-pay jobs.

DGB board member Stefan Körzell demands tailored support for the long-term unemployed and the containment of temporary work and service contracts to counter imbalances on the labor market.



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