Who earns minimum wages in Europe - European Trade Union ...

François Rycx and Stephan Kampelmann
the shadow employment spike is higher than the actual employment spike in
Bulgaria, Poland, Romania, and Spain.
3.2.1 Graphical analysis
A complementary way to shed light on the international variations among
minimum wage systems is to depict the existing wage floors with the help of
distributional graphs. This exercise is particularly salient as it allows to
visualize the distinction between Type I and Type II countries that we
introduced in Section 2.4.
Figures 1 through 4 plot existing minimum wages as thin vertical lines onto
the national wage distribution in 2007. The difference between Type I
countries (Bulgaria and Hungary) and Type II countries (Belgium and
Germany) comes out very clearly on these graphs: the two former countries
display a clean cut that truncates the wage distribution at the level of the
(national) minimum wages; the employment spike around the minimum
wage is clearly visible in both countries. This holds also for the other Type I
countries whose wage distributions can be found in Annex A.
By contrast, the shape of the lower tail of the wage distributions of Belgium
and Germany are much more gradual and reflect the existence of an array of
different sectoral minima. This being said, it should be noted that even in
Type II countries each existing wage floor also creates a truncated wage
Figure 1 Wage distribution and minima in Bulgaria (2007)
0 2 4 6 8
percent
Source: BU-SILC; current 2007 euros; thin vertical lines represent levels of national minima (differentiated by educational
activity and job tenure).
34 Report 124
Bulgaria (2007)
0 1 2 3 4 5
gross hourly wage (euros)