1. Introduction

In the modest term, a minimum wage is a lawfully authorized minor bound for wages, but the term “lawfully authorised” is unclear, leading too many different kinds of minimum wages institutions (Cunningham et al, 2007:19). It further states that in the most straight forward cases, such as Brazil and Bolivia, the federal government identifies a wage level and all employers in the country must pay at that level or above it (2007:19).
Economist have tended to oppose minimum wage on the grounds that they reduce employment , hurting many of those they are supposed to help (the economist:24/11/2012). The main “common sense” argument is that by imposing minimum wages, one artificially raises the price of labour way from its “market-clearing” level and higher unemployment results-and the first to lose their jobs will be the least-skilled workers (city press;2014/11/25).
The national minimum wage is a step towards an alternative growth path, in other words wages must be set to target productivity and efficiency. But it must be accompanied by other alternatives; such as industrial policy that sees that South Africa create jobs in sectors that can sustain moderately higher wages, and grow sectors that can benefit from, and contribute to, increased domestic demand (city press;2014/11/25).
However national minimum wages promote equality, combat poverty and support economic development e.g. in Brazil during Lula’s tenure as president, the statutory minimum wage rose