Minimum Wage in Hong Kong

Topics: Minimum wage, Poverty, Unemployment Pages: 3 (992 words) Published: November 27, 2010

Potential advantages of the minimum wage law in Hong Kong

Implementation of a reasonable amount of minimum wage is necessary for the current situation in Hong Kong. Minimum wage law prohibits workers or employees hired for less than a given hourly, daily or monthly minimum wage (Filion, 2009). Hong Kong is facing a difficulty of wealth gap. Although Hong Kong has a great reputation of the financial hub and one of the most affluent cities, its wealth gap is the worst in Asia (Lau, 2009). There are thousands of people living in cage homes (Leung & Long, 2010). Moreover, in 2008, the city’s cage homes had risen, and one third of their average monthly income of cage home dwellers had gone on rent (Lau, 2009). Their bosses will try to pay fewer wages unless certain minimum wage exists. The law minimum wage should be introduced in Hong Kong as it will enhance the living standard of the poor citizens, bring in benefits for many industries, and will not lead to unemployment.

Implementation of the minimum wage will enhance the standard of living for the poorest. In 1996 and 1997, a study conducted in United States found that minimum wage increased the average minimum wage worker which brings 54 percent more of his or her family’s weekly income (Filion, 2009). In 2006, the poor citizens can only earn below $5.50 per hour, however, in 2008, after the minimum wage increased, their wage raised to above $6 per hour (Filion, 2009). Growth of income motivates and encourages low-income people to work harder, instead of pursuing money through illegal means. It also stimulates their purchasing power. In Chicago, USA, a study found that as minimum wage was raised, poor citizens’ spending went up (Filion, 2009). In Hong Kong, there are thousands of people living in cage homes, and over the year of 2009, the city’s cage homes had risen by around 20 percent (Leung & Long, 2010). The average monthly income of cage home dwellers was...

References: Filion, K. (2009, July 21). Minimum Wage Issue Guide. Economic Policy Institute. Retrieved October 7, 2010 from
Garthwaite, C. (2003, December 26). High minimum wage = high unemployment. Seattlepi. Retrieved November 13, 2010 from
Lau, J. (2009, December 17). Hong Kong 's cage homes capture city 's stark inequality. Financial Times. Retrieved October 7, 2010 from
Leung, C., & Long, Y. (2010, September 7). Elderly should not have to endure cage-home conditions. South China Moring Post. Retrieved October 7, 2010 from
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