Is a minimum wage an effective or residual social standard?

Abstract

The article is devoted to the study of the minimum wage as a social and labor standard. The liberalization of the economy has led to a simplification of social and labor relations, a reduction in the share of labor contracts with social obligations on the part of businesses, and a transition in remuneration from minimum wage guarantees to an agreement on remuneration for services rendered, that is observed around the world. The article indicates the possible consequences and threats of transferring social obligations and insurance directly to employees. According to international statistics, a comparison of the minimum wage in Ukraine and in other countries of the world is made. The author emphasized the need to study the minimum wage as component of the system of basic social standards and, based on the data of a sociological survey, determines the degree of correspondence of the minimum wage and the subsistence minimum to the real cost of living in Ukraine. Special attention is paid to the role of the minimum wage in the mechanisms of state policy in the labor market. Raising the minimum wage has a positive effect on reducing working poverty, inequality, and social tension in society. At the same time, it is also necessary to increase the rates of social assistance linked to the minimum wage, that will also contribute to an increase in the standard of living of the population and, in particular, the least affluent segments. A warning is made that the minimum wage cannot be replaced by other social standards, such as the minimum basic income, which can only be introduced if it is supplemented to the existing system of social guarantees. The conclusion of the analysis is the justification for maintaining the minimum wage as an effective social standard necessary for developing strategies for the post-war economic recovery of Ukraine.