A country’s minimum wage is the lowest amount of money that employers in that country are legally allowed to pay their workers for a given unit of work. It is typically computed on a per-hour or per-month basis, but may occasionally appear as a per-day or per-week rate.
Minimum wages were first utilized to address the exploitation of workers in sweatshops and then came to be seen as a way to prevent exploitation and help lower-income families everywhere.
Minimum wage: Pros and cons
The minimum wage is a type of payment that covers your labor costs and complies with regulatory requirements. Employers are not allowed to pay their staff less than these stipulated hourly or salary rates. It acts as a safety net, guaranteeing that full-time employment may be used to meet basic needs.
Opponents of minimum wage claim that the higher labor costs will increase inflation and force businesses to raise prices (which reduces the purchasing power of the consumer) to make ends meet and/or lay off workers they can no longer afford to pay, which leads to higher unemployment and more poverty. Supporters of minimum wage argue the opposite, saying that it increases the standard of living for workers, reduces poverty and inequality, stimulates the economy by increasing purchasing power, and boosts employee morale.
Let’s take a look at some of the countries in the world with the highest monthly net wage in 2024, as per Statista.
Luxembourg (Minimum monthly wage: $2,459)
A European nation boasts the highest minimum wage worldwide, with skilled workers over 18 earning a monthly minimum of $2,459. Luxembourg’s economy as a whole has proven its resilience time and again over the past decades, weathering global crisis without losing its triple A status. This is in part due to the efforts at economic diversification undertaken by generations of policymakers and stakeholders, and also strong support for innovation and development. Finance remains the largest grossing single economic sector. It contributes 31 percent to the country’s GDP. This sector is building upon well-established infrastructures, a multinational expert workforce, and also the Luxembourg’s reputation as a European hub. Other sectors are cashing in on the same advantages though, attracting talents from all over the world. For instance, logistics and the automotive sector, and also the audiovisual sector, the digital economy. In fact, lifetech, fintech and space technologies have benefited from government-sponsored initiatives in their respective fields to make headlines worldwide.
Netherlands (Minimum monthly wage: $2,326)
The Netherlands is a founding member of the World Bank. It was one of the first countries to receive a World Bank loan after the Second World War. These initial loans helped to rebuild the economy, modernize and expand the Royal Dutch Airlines fleet, and replenish the working capital of the Dutch Reconstruction Bank (Herstelbank). Today, the Netherlands is a member of all five institutions that form the World Bank Group. The Netherlands and the World Bank work with other member governments to finance projects, design policies, and deliver programs to eradicate poverty in the developing world. For many years, the Netherlands has enjoyed a robust economy and strong workforce. The country has one of the highest employment rates and workforce productivity rates in the European Union. Globally, it ranks fifth for competitiveness, sixth for happiness, ninth for social progress, and tenth on the UN Human Development Index.
Australia (Minimum monthly wage: $2,150)
Australia is a stable, democratic and culturally diverse nation with a highly skilled workforce. It is one of the strongest performing economies in the world. The country has spectacular landscapes and a rich ancient culture. It is the world’s sixth-largest country in land area and is the only nation to govern an entire continent. Australia is an open market economy with minimal restrictions on import of goods and services. That makes its economy highly productive and dynamic. Australia has FTAs, under bilateral and multilateral arrangements, with New Zealand, Singapore, USA, Thailand, Chile, ASEAN, Malaysia, Korea, Japan, China, Hong Kong, Peru, Brunei Darussalam, Canada, Mexico, Vietnam, and recently with India. Australia remains a significant exporter of natural resources, energy and food items, drawing mainly from its extensive reserves of natural resources. These are coal, iron, copper, gold, natural gas, uranium, and renewable energy sources and an efficient agricultural production base.
Read more: 10 countries with the world’s youngest populations
Ireland (Minimum monthly wage: $2,020)
Ireland has a mixed economy. The constitution provides that the state shall favor private initiative in industry and commerce, but the state may provide essential services and promote development projects in the absence of private initiatives. Thus, state-sponsored bodies operate the country’s rail and road transport, some of its television and radio stations, its electricity generation and distribution system, and its peat industry. State companies also are active in the fields of air transport and health insurance. The advent of a single European market in the 1990s encouraged many of these enterprises to privatize and become more competitive. Ireland’s high-technology sector — made attractive by a very low 12.5 percent corporate tax rate — spurred economic growth during the 1990s. It also helped reduce unemployment to historically low levels. The economic boom, during which the country’s growth was more than double that of most other EU countries, gave rise to the country’s being labeled the ‘Celtic Tiger’.
New Zealand (Minimum monthly wage: $1,977)
New Zealand’s economy is developed, but it is comparatively small in the global marketplace. In the late 19th and early 20th centuries, New Zealand’s standard of living, based on the export of agricultural products, was one of the highest in the world. However, after the mid-20th century the rate of growth tended to be one of the slowest among the developed countries. Impediments to economic expansion have been the slow growth of the economy of the United Kingdom (which formerly was the main destination of New Zealand’s exports) and its eventual membership in the European Union and the high tariffs imposed by the major industrial nations against the country’s agricultural products (e.g., butter and meat). New Zealand’s economic history since the mid-20th century has consisted largely of attempts to grow and diversify its economy by finding new markets and new products, expanding its manufacturing base, and entering into or supporting free-trade agreements.
United Kingdom (Minimum monthly wage: $1,937)
The United Kingdom has a fiercely independent, developed and international trading economy that was at the forefront of the 19th-century Industrial Revolution. According to the U.K. Office for National Statistics (ONS), the services sector is the largest sector in the U.K., accounting for 80 percent of gross value added (GVA), a measure of economic output that is similar to GDP. The service industry in the U.K. comprises many industries, including finance and business services, and consumer-focused industries, such as retail, food and beverage and entertainment. The other two major contributors are manufacturing and construction, which contribute 10 percent and 6 percent to the U.K.’s total economic output, respectively. Agriculture contributes about 0.67 percent.
Germany (Minimum monthly wage: $1,729)
Germany is one of the largest economies in the world by nominal GDP and the largest economy in Europe. The country is the world’s third-largest exporter and importer of goods. Being a part of the European single market, Germany has access to more than 450 million consumers. It has a social market economy. In 2002, Germany introduced the common European currency, the euro. The European Central Bank, headquartered in Frankfurt, sets monetary policies for the whole eurozone. It is the home of 29 of the Fortune Global 500 companies. The country also has a highly skilled labour force, a low level of corruption, and a good infrastructure. Research and development are highly regarded in Germany.
Canada (Minimum monthly wage: $1,633)
Canada has the seventh-largest economy in the world. Most of the businesses are privately-owned, although the government does play a major role in the healthcare system. They operate many services including transportation and utility companies. The Canadian economy is diverse and highly developed. It is very similar to the American economy, although smaller in size. In the aftermath of World War II, the nation was transformed from a rural economy, based on agriculture, to one based on industry and mining. The nation’s economy has been further transformed since the 1970s and services now provide the main economic output. The foundation of the Canadian economy is foreign trade. The United States is by far the nation’s largest trade partner. Foreign trade is responsible for about 45 percent of the nation’s gross domestic product (GDP). Free trade agreements between the two nations have increased trade by eliminating tariffs. Each day approximately $1 billion worth of goods crosses the U.S.- Canadian border.
United States of America (Minimum monthly wage: $1,619)
The United States has a diverse, highly developed and private-sector-led economy. It is the largest in the world in nominal GDP terms. And is characterized by high levels of productivity, technological innovation and competitiveness. Other key economic strengths include a flexible labor market, relatively solid demographics compared to other rich nations. Also, the use of the dollar — the world’s reserve currency. U.S. economic data is strong. In the decade to 2023, the United States boasted real GDP growth of 2.3 percent.
Belgium (Minimum monthly wage: $1,617)
Belgium has a free-enterprise economy, with the majority of the gross domestic product (GDP) generated by the service sector. The Belgian economy also is inextricably tied to that of Europe. The country has been a member of a variety of supranational organizations. These include the Belgium-Luxembourg Economic Union (BLEU), the Benelux Economic Union, and the EU. The first major step Belgium took in internationalizing its economy occurred when it became a charter member of the European Coal and Steel Community in 1952. On January 1, 1999, Belgium also became a charter member of the European Monetary Union. That paved the way for the introduction of the euro. That became the country’s sole currency in 2002, replacing the Belgian franc.
For more miscellaneous news, click here.
