Which Country Has the Highest Minimum Wage?
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Key takeaways
- With a federal minimum wage of $7.25, the United States does not place in the top 10 in 2021.
- Seven of the 10 countries with the highest minimum wages are from Europe.
Most developed countries enact minimum wage increases every year for full-time workers as the cost of living increases. But not everyone. The countries with the highest minimum wages in the world in 2021 have strong social support programs, allowing wage workers of all types and skill levels to work and live without being completely impoverished.
Historically, minimum wage laws are rather new. New Zealand was the first country in the world to implement a minimum wage law, doing so in 1894. The United Kingdom implemented its own minimum wage policies in 1909 while the United States did not get a federally mandated minimum wage law until 1938. Currently, the United States doesn't rank in the top 10 of countries that pay their minimum wage workers the most.
These 10 countries have the highest minimum wages per hour in the world. Currency has been converted to U.S. dollars.
1. Luxembourg: $18.33/Hour
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GDP: $62.3 billion
GDP growth: 2.3 percent
Population: 625,978
GDP per capita: $105,280
Share of world GDP: 0.08 percent
Unemployment rate: 6.1 percent
Bottom Line: Luxembourg
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With an hourly wage of 15.27 euros ($18.33 USD) for skilled workers 18 years and older, Luxembourg is the country with the highest minimum wage in the world.
To be considered a skilled worker in Luxembourg, the employee must have one of these qualifications for fields where certification is possible:
- Education. Certification of some kind relevant to their profession.
- Manual skills and experience. The worker needs a manual skills certification and two years of experience
- Experience. Without a certification, 10 years of experience are required.
Unskilled workers earn 12.94 euros an hour, which is the equivalent of $15.53 USD.
For 10 years, from 2011 to 2021, New Zealand raised its minimum wage 10 times, increasing it by 444 euros ($533 USD) for unskilled workers and by 533 euros ($640 USD) for skilled workers.
2. Australia: $15.30/Hour
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GDP: $1.3 trillion
GDP growth: 1.96 percent
Population: 25.5 million
GDP per capita: $53,831
Share of world GDP: 1.64 percent
Unemployment rate: 5.9percent
Bottom Line: Australia
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Australia has a national minimum wage of $19.84 AUD per hour, which is the equivalent of $753.80 AUD per week — or $15.20 per hour and $581USD per week.
There are some different minimum wage rates in Australia as well. Apprentices are paid less, as are workers under 21 years of age. In fact, those under 21 years of age — junior workers — are paid a percentage of the salaries of those 21 years or older (like 60 percent), and that percentage increases as they grow older.
In 2020, the Fair Work Commission increased the minimum wage for 2021 and implemented it via a staggered rollout.
3. New Zealand: $14.40/Hour
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GDP: $204 billion
GDP growth: 3.03 percent
Population: 4.8 million
GDP per capita: $43,415
Share of world GDP: 0.25 percent
Unemployment rate: 4.9 percent
Bottom Line: New Zealand
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New Zealand raised its minimum wage to $20 NZD ($14.40 USD) in 2021, making it the third country with the highest minimum wage in the world.
That $20 NZD rate is for adults, which New Zealand classifies as any employee 16 years or older. However, 16- and 17-year-old employees have to do six months of work with an employer to receive that rate. During this period, they are known as starting-out, or in training, and receive $16 NZD per hour ($11.52 USD).
In March 2021, New Zealand increased its minimum wage by $1.14 NZD ($0.82) and increased taxes on the top 2 percent earners of New Zealanders.
4. Germany: $12.55/Hour
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GDP: $3.7 trillion
GDP growth: 2.22 percent
Population: 83.8 million
GDP per capita: $44,680
Share of world GDP: 4.56 percent
Unemployment rate: 6.2 percent
Bottom Line: Germany
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In October of 2020, Germany increased its national minimum wage from 9.35 euros ($11.35 USD) to 10.45 euros ($12.55 USD). However, that minimum wage increase is rolled out over four stages, increasing twice each year until it hits 10.45 euros in June 2022. It's a pay increase of nearly 12 percent for minimum wage earners.
Interestingly, this law was passed in the middle of the pandemic, with Labor Minister Heil saying the "minimum wage must not fall behind."
5. United Kingdom: $12.33/Hour
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GDP: $2.6 trillion
GDP growth: 1.79 percent
Population: 67.9 million
GDP per capita: $39,532
Share of world GDP: 3.26 percent
Unemployment rate: 4.9 percent
Bottom Line: United Kingdom
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Like other European countries, the minimum wage in the United Kingdom depends on your age.
Unlike other countries, a worker needs to be at least 23 years old to get the full minimum wage of 8.91 pounds ($12.33 USD) per hour. People who are 18 to 20 years old make 6.56 pounds ($9.08 USD) an hour while those aged 21-22 make 8.36 pounds ($11.57 USD).
Everyone under 18 makes 4.62 pounds ($6.39), and apprentices make 4.30 pounds ($5.95).
6. France: $12.31/Hour
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GDP: $2.6 trillion
GDP growth: 1.79 percent
Population: 65.3 million
GDP per capita: $39,827
Share of world GDP: 3.19 percent
Unemployment rate: 7.9percent
Bottom Line: France
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France has a statutory minimum wage of 10.25 euros per hour, which equals 1,554.58 euros per month. In U.S. dollars, that's the equivalent of $12.31 per hour or $1,866.51 per month.
While nearly all workers, including part-time ones, must be paid this rate, young apprentices can be paid substantially less. France has a tiered system for apprentice pay, with 16- and 17-year-olds making only 419.74 euros a month (about $531 USD).
7. Ireland: $12.26/Hour
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GDP: $331.4 billion
GDP growth: 7.80 percent
Population: 4.9 million
GDP per capita: $69,727
Share of world GDP: 0.41 percent
Unemployment rate: 7.2 percent
Bottom Line: Ireland
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Ireland increased its minimum wage by 1 percent in 2021, going from 10.10 euros ($12.14USD) to 10.20 euros ($12.26 USD).
It's a tiny jump, but Ireland had a large minimum wage increase in 2016, when the government increased the hourly minimum rate from 8.65 euros ($10.39 USD) to 9.15 euros ($11 USD).
While opponents to the increase said it would significantly increase labor costs, a study on the wage hike found that 90 percent of companies in Ireland with minimum-wage workers experienced no real labor cost increases.
8. Belgium: $12.20/Hour (Estimated)
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GDP: $494.7
GDP growth: 1.73 percent
Population: 11.6 million
GDP per capita: $43,325
Share of world GDP: 0.61 percent
Unemployment rate: 5.6 percent
Bottom Line: Belgium
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Belgium is an interesting country when it comes to minimum wage, because the nation does not have a set by-the-hour pay rate. Instead, workers are paid according to a monthly wage, which is currently 1,625.72 euros ($1,953.38 USD) per month.
Additionally, the typical workweek is between 36 and 40 hours. Working more than this is possible, but companies and workers will have to jump through some hoops.
Doing some quick and dirty math, $1,953.38 USD broken down into four, 40-hour workweeks equates to $12.20 per hour.
9. Netherlands: $11.68/Hour
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GDP: $830.6
GDP growth: 3.16 percent
Population: 17.1 million
GDP per capita: $48,796
Share of world GDP: 1.03 percent
Unemployment rate: 3.6percent
Bottom Line: Netherlands
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The Netherlands doesn't mandate a strict hourly minimum wage. Instead, since different jobs require different hours in that country, the nation mandates per-month, per-week and per-day sums.
Those minimum wage requirements are 1,684.80 euros ($2,025 USD) per month, 388.80 euros ($467.21 USD) per week and 77.76 euros ($93.44) per day.
Generally, according to the New Zealand government, a person over the age of 21 working 40 hours a week can expect to be paid 9.72 euros an hour, or $11.68 USD.
10. Canada: $9.16-$12.80/Hour
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GDP: $1.6 trillion
GDP growth: 3.05 percent
Population: 37.7 million
GDP per capita: $44,841
Share of world GDP: 2.04 percent
Unemployment rate: 7.5percent
Bottom Line: Canada
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Canada's minimum wage laws differ from each of its 10 provinces and three territories.
Saskatchewan is the province with the lowest minimum wage, with a minimum wage of $11.45 CAD ($9.16 USD). Nunavut has the highest minimum wage, with $16 CAD ($12.80 USD), followed by Alberta ($15 CAD, $12 USD) British Columbia ($14.60 CAD, $11.68 USD) and Ontario ($14.25 CAD, $11.40 USD).
Even with these changing rates, Canada has consistently ranked among the top 10 in the world for countries with the highest minimum wage rates.
Related:Wealthiest Countries in the World