Top 10 Countries With Highest Minimum Wages

The minimum wage, as defined by the International Labour Organisation (ILO), is the lowest amount of compensation that an employer is required to pay wage workers for the duties they perform during a defined length of time. However, it cannot be lowered or raised through a collective bargaining agreement or a bilateral agreement between the parties.

Now you might be thinking which country pays the highest salary per hour? More than 90 countries around the world agree and apply the ILO's minimum wage norm. Some countries with the highest minimum wage pay much higher than the ILO standard when compared to other countries.

Many international students are unaware that the highest minimum wages have an impact on them as well, whether they choose to work part-time or look for employment after graduation. But how do these minimum wage rates operate, what are their different varieties, and what criteria are used to determine them? As we examine the top 10 countries with the highest minimum wage for international students, we will also find the answers to these questions.

Planning to study abroad or work in a country providing the highest minimum wage in the world? We recommend taking help from our experts to increase your employability in the country of your choice!

What is the Minimum Wage for International Students?

Minimum wage means the minimum salary an employee is entitled to earn in return for their services or labour. This amount is set by the authoritative government of the country and no contract can breach this rate for a lower wage rate, even if there is an understanding between the employer and employee. Hence, the minimum wage is binding in nature.

The calculation of wages commonly uses an hourly, daily, weekly, monthly, or annual basis. It is shown as a worker's overall income, which is typically before tax and other contributions that must be paid by the employee. These figures are neither continuous nor static since they differ from one nation to another. Instead, they are often on a monthly basis and are mandated by law.

Employers must pay the wage or, if possible, more than it, but not less, in order to avoid taking advantage of or exploiting people who are in desperate need of employment. The purpose of wage rates is to help workers raise their level of living and make ends meet.

Factors Affecting Minimum Wages

Any government before affixing or revising the National Minimum Wage rate takes into account the following factors:

Population: The overall population of a country and its demographics, such as children per family, birth rate, death rate, male-to-female ratio, etc., affect the amount which a bread earner of a family needs to earn.

Inflation Rate: The inflation rate is the rate at which an economy is ballooning. It is measured by observing how the overall prices of goods and services are rising in an economy. It affects the amount needed to afford the basic necessities of life.

Basic Necessities Current Price: The current prevalent price is observed to assess how much a family needs to spend in current circumstances to survive as a citizen of the country.

Standard Deviation Error: The current prices are compared with the past prices to get an idea of possible deviation among prices, and the rate at which it occurs.

Projections: Based on the current price and SD error projections are made for the future. Since the national minimum wage rate fixing process is not simple it is fixed periodically. These projections help in fixing a rate that can keep up with the prices and inflation rate during the upcoming period until it can be revised.

Productivity: The employment and unemployment rates play a huge role in fixing the minimum wage rate. It shows how many able workers in an economy are relying on the working section.

Demand and Supply: The product demand and supply are also assessed for both harder and easier times. Only the basic necessary commodities and services are considered.

Trade Unions Demand: The labour trade unions and their demands are considered and checked for substance, that is whether they make sense or not. The valid demands are taken into account while fixing the minimum wage rate.

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Types of Minimum Wages

Generally, no country fixes a single National Minimum Wage rate. This is because there are many types of workers active in an economy at any time. To ensure the protection of their earning rights along with their other rights, a different minimum wage is fixed for different types of workers. Some of the types of minimum wages identifiable are:

Rural Minimum Wage: The rural minimum wage is set in accordance with the prices prevalent in such areas, and the basic necessary requirements, which are lesser than urban workers.

Urban Minimum Wage: The urban minimum wage is often higher than the rural minimum wage, due to increased expenses of basic commodities, travel to work, etc.

Skilled Labour Wage: If the worker can show proof in favour of their skills then they are entitled to a higher minimum wage rate. This is to ensure an ROI on the skill enhancement process.

Unskilled Labour Wage: Commonly lower than the skilled wage rate, it is often earned by apprentices, blue-collar workers, or seasonal workers.

Adult Labour Wage: The minimum wage rate at which adults, or workers of age 18-50, shall be compensated may also be differently set, for their higher productivity. The age bracket may differ for different countries.

Senior and Super Senior Wage: The workers above the age of 50 are considered senior and above the age of 65 are considered super senior. Their wage rates are set differently on the basis of their contribution to economic growth. Also, the age bracket is privy to change.

Adolescent and Minor Labour Wage: It is extremely important for any nation to secure the rights to education and childhood for all minors, hence while child labour is prohibited, a wage rate on the basis of personal skill and talent is allowed. A different wage rate is set for 14-18 year adolescents, as their rights are a converging point for child and adult rights.

Note: A country may have some, all, or wholly different types of minimum wage distribution, in accordance with the national economic situation.

As you might have guessed, different countries have different highest minimum wage rules set pertaining to each profession. Take a quick look at the following video to explore the top 10 countries that provide the most demanding courses to international students which yield the highest salaries after graduation:

Top 10 Countries with Highest Minimum Wages for International Students

With the goal of increasing the mean pay of low-skilled employees, New Zealand was the first nation to implement a minimum wage law in 1894. With the support of the respective highest minimum wage in the world, governments can better protect employees' rights and make certain that they receive adequate compensation for their labour and hardships.

However, as the name implies, the minimum wages are simply intended to serve as a baseline protection line, and employees, including international students, are free to bargain for higher compensation. Here are the top 10 countries with the highest minimum wage in the world, along with their hourly minimum wage rate:

Source: World Population Review

Minimum Wages According to Region

While it is a norm to consider all countries through the same lens, it must be noted that different countries have different circumstances. Their economic structures may support a lesser minimum wage rate, or their population is high to saturate the overall earnings.

Even the geographical placements of a country impact the earning momentum of its subjects. Here are the countries with the lowest and highest minimum wage in the world according to region or continent:

Source: Statista

Top 10 Countries With Highest Paying Jobs

The best countries to study and work for international students are those which can appropriately compensate for their services and knowledge. Since they make an investment to gain knowledge and professional expertise, they also deserve proper compensation for their efforts. Here are the top 10 countries with the highest paying jobs, along with their national average salary and minimum wage rate:

Source: Paylab, Minimum Wage

Best Courses for High-Paying Jobs Abroad

International students can benefit from certain courses with high earning capacity. Here are some of the courses and their average salary in the USA, United Kingdom, and Australia, after course completion:

Source: Glassdoor & Indeed

Who Sets Minimum Wages Across the World?

The answer to this question actually differs from one country to another. While some nations have implemented what is referred to as a national or statutory minimum wage, other nations have implemented a system of regional minimum wages. Whereas other nations still leave it entirely up to workers' unions and businesses to determine the minimum wage for their specific industry or sector in collective bargaining agreements (CBA). If the latter is true, sector-specific minimum wages might apply to the entire nation or just a distinctive region.

Thus, a variety of parties, including the parties to a CBA, federal and regional governments, special governmental boards (commonly referred to as minimum wage boards), institutions whose primary job is controlling national wage levels, and others, may set the minimum wage.

What Countries Do Not Have Minimum Wages?

Or perhaps it would be wiser to ask: "Which countries do not have a national minimum wage?" As we have already seen, minimum wages do not always need to be determined by the national government; they can also be set for specific regions or business sectors. As a result, practically every nation has some sort of minimum wage regulation.

The Nordic nations of Denmark, Norway, Sweden, Iceland, Finland, and Switzerland are the most frequently mentioned (developed) nations that do not have a set national minimum wage since minimum wages there are determined by each canton. Singapore, Cyprus, and Austria are among the nations without a set minimum wage.

However, all the nations on this list have other systems in place that set minimum wages, such as collective bargaining agreements or laws pertaining to particular job categories. Employees in Cyprus, for instance, must get a minimum pay of at least EUR 870 per month if they work as shop assistants, clerks, or in job positions that are similar.

Minimum Wage in India vs Abroad

The minimum wage in India is USD 0.87 per hour for highly skilled workers. In comparison to the Best Countries to Study Abroad for Indian Students, and other countries with the highest minimum wages, this is extremely low. However, the wage rate works in favour of the Indian economy. Apart from skill, the Indian government also considers the following factors to assign different wage rates:

• Area or region (rural or urban)

• Sector (such as agriculture, secondary industries, etc.)

• Working conditions (such as mining work underground or above ground)

• Government tender works (roads and dams construction)

• Public Sector employment

• Other types of workplaces and conditions.

The highest minimum wage rate in India after the revision of April 1, 2022, is USD 4.29 for workers in stone mines.

Source: Chief Labour Commissioner (Central)

Comparatively, many countries pay a higher hourly wage than India. However, more than a wage rate, there are living conditions, population density, and other environmental and economical factors which need to be considered when deciding to move to a certain country for employment, study, or PR. This includes language restraints, as even though English is among the most spoken languages in the world, it is not a native language in many countries. Hence, students are advised to do proper research on all impacting factors before deciding upon a study abroad destination.

Consult experts to properly explore the country most suitable for you and your career aspirations. You can write to us at abroad@collegedekho.com and connect with our experts.