Personal Finance

Do we need a worldwide minimum wage? We ask an expert


When P&O sacked 800 of its workers with the intention of replacing them with agency staff, including foreign workers allegedly paid less than minimum wage, it sparked an outcry. As businesses become more global, shouldn’t workers’ rights, too? I asked Jason Hickel, economic anthropologist and visiting senior fellow at LSE, if it’s time for a global minimum wage.

Am I right in thinking that when people discuss the global minimum wage, they’re not saying everyone on the planet should be paid the same?
That’s correct. Some people propose setting it at 50% of each country’s median income. Others, and this is my preferred option, propose that it should be pegged to decent living standards in each country. So whatever is required to access good housing, healthcare, education, water, electricity, internet and so on.

Right, because if you don’t peg it to living standards you get what we have in the UK: one in six working households in poverty. Could a global minimum wage lift the floor for Britons, too?
Yes, it would eliminate working poverty in rich countries as well as poorer countries. It may also help reduce excess material consumption in the global north, because without extreme labour exploitation consumer goods would be closer to their true cost. Shifting purchasing power from rich to poor, while guaranteeing decent living standards – that’s a gain for workers and ecology.

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But hang on, if there were still differences country to country, the P&O situation could happen again.
It’s conceivable. But under this arrangement, there would be much less variation in minimum wages. Most ordinary people would agree that people should be paid enough to live with dignity, right? And yet that isn’t the reality for the majority of people on this planet – and it’s happening in wealthy countries such as the UK and US, too. So I’d expect the popularity of this measure to be quite strong.

How would this be enforced?
It could be an agreement managed by an international institution – for example, the International Labour Organisation in Geneva.

Hmm, after Brexit, an organisation in Switzerland calling the shots might not play well in the UK.
The point should always be democratic consensus rather than strong-arming. As far as the ILO goes, the main problem is it represents not only the interest of labour but also the interest of states and businesses, so it’s a tripartite. To me, this is a weakness of the institution as a defender of workers’ rights. I’d like to see workers having a stronger voice. But it could be managed simply by international agreements, similar to those we have around emissions or the Universal Declaration of Human Rights. I’ve spoken to people in the ILO who said they have the capacity to manage such a system. It depends on nations’ political will.

Has it been taken up by a political party?
Not yet. It’s only been floating around as an idea for about the past 10 years.

Ooh, I love a big idea! Isn’t that why so many people are upset with politicians – no big ideas! Hey Jason, maybe this could be it…
Well, I would agree with that.

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