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

Executive summary
Context and objectives
After a period of neglect during the 1980s and 1990s, minimum wages have
re-appeared on political agendas in several European countries. Although
their critics regularly warn against potentially negative effects, notably as
regards low-wage employment, wage floors are widely regarded as useful
instruments to protect low-wage workers and to combat rising levels of
inequality and poverty.
Today, the European Union stands out as a traditional stronghold of this type
of labour market policy. Within the Union, however, there is much diversity
as to the national systems governing the fixing, implementation, and
monitoring of minimum wages. What is more, the persisting differences
among European countries with respect to the overall level and distribution
of wages create international variations in the level and bite of existing
minimum wages. The current context of widening income inequality and a
tight low-wage labour market in several Member States might not only
accentuate these differences, but is also likely to generate further interest in
minimum wages as a policy to counter these tendencies.
This study sets out to provide a comprehensive, evidence-based, and up-todate
assessment of minimum wages in a range of European countries. A first
step towards a better understanding of where Europe stands today on this
issue requires to grasp the diversity of European minimum wage systems, a
key objective of the study at hand. The second objective is to document
international differences in the so-called "bite" of the minimum wage. This
leads to questions such as "how do national minimum wages compare to the
overall wage distribution?" and "how many people earn minimum wages in
each country?" that are assessed for a set of nine countries from Western,
Central and Eastern Europe: Belgium, Bulgaria, Germany, Hungary, Ireland,
Poland, Romania, Spain, and the United Kingdom. This sample was designed
to include countries for which recent evidence has been missing prior to this
report; indeed, recent information on minimum wages in Central and Eastern
European countries is urgently needed to compare the labour market
outcomes in different geographical areas of the Union. The report also
includes Belgium and Germany as examples of countries with complex
minimum wage systems that are unfortunately not treated in many
comparative studies. What is more, the study also overcomes the narrow
focus of extant overviews that have typically focussed only on full-time
employment.
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