The reason is that the German Post, which is a high-wage employer, faces increasing competition from lower-cost carriers. If the minimum wage is imposed, it will not raise Deutsche Post’s average variable cost by much, since most of its workers already make more than the proposed minimum wage; but it will raise its competitors’ costs.In other words Deutsche Post wants the government to act in an anti-competitive manner to help it deal with competition. The German governemnt should just tell Deutsche Post to become more efficient, that's how you deal with competition.
One wonders if the government would be thinking about this idea if Deutsche Post wasn't a former government firm. Is this just the government trying to give a former state-owned and still inefficient firm an unfair advantage?
1 comment:
Isn't that why unions, whose members earn well above minimum, often lobby for increased minimum wages?
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