KUCHING: The Malaysian Trades Union Congress (MTUC) Sarawak welcomes the Nobel Prize for minimum wage study which was recently awarded to economists David Card, Joshua Angrist and Guido Imbens.
MTUC Sarawak secretary Andrew Lo lauded the trio who won the 2021 Nobel Economics Prize on Monday (Oct 11) for pioneering natural experiments to show real-world economic impacts from minimum wage increases in the fast food sector of the United States.
“One experiment by Card on the impact in the fast food sector of a minimum wage increase in the state of New Jersey in the early 1990s debunked conventional wisdom in economics that such increases should always lead to job losses.
“His work on the topic, often in collaboration with prominent economist Alan Krueger who died in 2019, has been used as empirical evidence to push for legislation in several countries to either implement minimum wage systems or in the case of the US for US$15 (RM63) per hour minimum wage in the country,” Lo said in a recent statement.
The chief executive officer of Sarawak Bank Employees Union pointed out that with this most prestigious of global recognition, employers should no longer argue that increase in minimum wage would lead to job losses.
“A benefit to the country is that higher wages will lead to higher purchasing
power which in turn will lead to increased domestic demand and reduce our reliance on exports which are at the mercy of other countries’ economic performance.
“It will also spur productivity growth as employers have to invest in more efficient production methods instead of relying on millions of low paid, mostly foreign workers,” explained Lo.