How does minimum wage work?

[Biges]

How does minimum wage work?

And I did search

[zezeb]

Yeah I also never quite understood it...
I think it has to do something with your workers must get so much payed in the factories or something like that.

[bbasgen]

Factory workers are paid from factory revenue. Minimum wage increases the payment they receive and thus reduces the total factory profit.

[am300307]

Factory workers are paid from factory revenue. Minimum wage increases the payment they receive and thus reduces the total factory profit.

What about pensions?

[heliostellar]

What about pensions?

They pay the elderly. Although, I don't think there is any way to see how many elderly you have. You'll notice that your total population doesn't match the Pop count under the population screen. That's because the population screen only shows working age men. The difference includes women, children, and the elderly.

[Biges]

Thanks!
So, minimum wages actually do exactly the same thing as in reality? I.e. raises the cost of workforce, thus reducing the profit?
As many of my factories are in "red numbers", I guess it makes no sense to enact this reform?

[the_Hussar]

It could make sense, as it gives you advantages. I don't recall specifically, but your POPs are generally happier, and it is an Immigrant Attraction.

[Camara]

Richer pops means they put money in the national bank, if you need to loan you'll get first to your bank so if you bankrupt you don't have the world jumping on you.

I'm not sure if it also contributes to promotions, as they'll more likely to get luxury goods. In any case they'll buy from your internal economy if you have the goods, so everyone will be getting money -> everyone is giving you taxes.

[Biges]

I'm playing Russia, so immigration does not concern me. As well as money, I'm dirty rich. I'm trying to run LF economy which contradict the concept of minimum wage.

[Thanik]

Wage -> increase buy power of pops(wealth) ,and reducing factory profit. With LF policy without subsidies , effect can be devastating to your economy. I don't advise this without super techs/infrastructure to boost factory profit.
Pensions -> increase buy power of pops(wealth) , and you pay from budget. So no negative modifier to your factories.

So if you have money it is better to enact pensions.

[bbasgen]

So if you have money it is better to enact pensions.

Quite right. School reform is the best social reform, followed by pensions.

For minimum wage, consider that the more money your POPs have, the more money your government has. In the late game, factories tend to be highly profitable so the margins allow for the workers to get more money, which in turn makes them much better POPs for your empire. If your POPs are suffering, ultimately, your nation suffers. There are many things this game gets right about the real world balance of fiscal policy and people's needs, and this basic dynamic is one of them.

[Biges]

I already have good pensions and trinket unemployment subsidies. And of course max education, advanced health care, art endowment (playing PDM)... I'll just wait 'till factories can make more money before enacting the minimum wage reform. If ever.

[calvinhobbeslik]

What does art endowment do in pdm?

[Phalanxia]

I thought pensions were just free money to every POP.

[Naselus]

What does art endowment do in pdm?

Extra prestige gain.

I thought pensions were just free money to every POP.

No; they form the cash pool for paying POPs who take income from the reform slider - usually Crats luxury income comes from pensions.

[the_Hussar]

I already have good pensions and trinket unemployment subsidies. And of course max education, advanced health care, art endowment (playing PDM)... I'll just wait 'till factories can make more money before enacting the minimum wage reform. If ever.

I'm also playing Russia right now in PDM, and find it impossible to enact Social reforms. You have found the solution to the great mystery. Now if only I could do it.

[Naselus]

I'm also playing Russia right now in PDM, and find it impossible to enact Social reforms. You have found the solution to the great mystery. Now if only I could do it.

That's because, like the entirety of the rest of the world, he's playing the AHD version while you're still playing 4.5.2 GO BUY AHD ALREADY.

[the_Hussar]

LOL ... It's on my To Buy list ... so next time when it goes on sale, I will.

Can I help it if I still enjoy your PDM. :P

[Biges]

Oh, I get reforms easily in PDM for THD. I push my population towards liberalism everywhere I want. But that's another story, I mean no minimum wage for you, you lazy workers!