A living wage is based on the cost of living and allows for basic needs to be met. It is not meant to eliminate class differences but ensure access to basic privileges. Minimum wages often do not keep up with the cost of living, causing economic hardship. Living wages have been set in some areas, but opponents argue it could hurt the economy.
A living wage is a wage that is based on the cost of living in an area, rather than an arbitrary minimum. With an ideal living wage, a person doing a normal 40-hour week job could afford housing, food, health care, and other basic needs. The amount of a living wage could potentially vary widely, as living standards differ in different parts of the world and the overall cost of living is also subject to extreme fluctuations.
Proponents of the living wage concept argue that everyone has the right to a comfortable standard of living, comparable to that enjoyed by other people in the same society. Living wages are not designed to eliminate class differences; obviously, some people make a lot more than others, and this would continue even with a living wage. A living wage would, however, ensure that everyone in a society has access to the same basic privileges and services.
Many countries around the world have so-called minimum wages. In these areas, all workers must be paid at least the minimum wage for their hourly work, even though many governments emphasize that the minimum wage is a base wage and that people should ideally be earning more than the minimum wage. Unfortunately, the cost of living often rises much faster than the minimum wage, causing economic hardship for people at the lower end of the wage spectrum.
Within some larger countries, individual provinces, states and cities have set their own minimum wages in an effort to offset the rising cost of living, and in some of these areas the new minimum wage has become a living wage. Living wages are calculated on the basis of what it costs to live a fairly ordinary life in a simple house with basic needs. Ideally, workers should spend no more than 30% of their income on housing, with the rest on food, transportation, health care, education, recreation, and other needs.
People who advocate living wages argue that in many areas people working on minimum wages are actually below the poverty line. It is common for people to work multiple jobs to support themselves, especially if they have children, and in some communities people in full-time employment have been forced to rely on homeless shelters, food banks and other social services because they cannot keep up. pace with the cost of living.
Opponents of the living wage say it could potentially hurt the economy, forcing employers to compensate their employees at a higher rate. Some have also suggested that the establishment of a living wage could lead to unemployment, as small businesses may be forced to let workers go because they cannot afford their wages. While these arguments are valid, some people believe that ensuring the same basic standard of living for all citizens is worth a short period of hardship in transitions.
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