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Labor Leaders Furious After World Bank Recommends Ditching Minimum Wage

Bernie Sanders is preparing to release his version of the “jobs guarantee” that has become a fixture of the UK Labour Party’s platform under leader Jeremy Corbyn.

And although his office admits it hasn’t carried out a cost analysis for its visionary plan, Sanders says his goal is to guarantee a job (paying $15 an hour) in construction, health-care, education and a handful of other fields, to every American who wants one.

But while the socialist fervor unleashed by Sanders’s 2016 primary run shows little sign of abating, a draft report released by the World Bank shows just how misguided a “jobs guarantee” would be.

In the report, the World Bank proposes lowering minimum wage and easing restrictions on hiring and firing for employers to help prepare countries for the onslaught of robot labor that consultancies including McKinsey believe will kill 800 million jobs by 2030, according to the Guardian.

The World Bank is proposing lower minimum wages and greater hiring and firing powers for employers as part of a wide-ranging deregulation of labour markets deemed necessary to prepare countries for the changing nature of work.

A working draft of the bank’s flagship World Development Report – which will urge policy action from governments when it comes out in the autumn – says less “burdensome” regulations are needed so that firms can hire workers at lower cost. The controversial recommendations, which are aimed mainly at developing countries, have alarmed groups representing labour, which say they have so far been frozen out of the Bank’s consultation process.

Of course, anybody who has followed our coverage of minimum wage hikes in OntarioSeattle(as well as McDonald’s workers’ “Fight for $15) would know that these types of government-mandated wage hikes often destroy more jobs than their backers realize. Furthermore, studies have found that mandated wage hikes disproportionately harm female and minority workers.

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