Policy Brief

Minimum wage response to COVID-19 and inflation crises: An Asia-Pacific region overview

This policy brief presents a comprehensive analysis of nominal and real minimum wages in the Asia-Pacific region from 2015 to 2022, taking into account the impact of inflation on the purchasing power of workers. Concentrating on 22 countries with available data, the study reveals a positive trend in real minimum wages before 2020, with an average annual increase of 2.5% between 2015 and 2019. However, commencing in late 2020, real minimum wages experienced a decline due to irregular adjustments and the inflationary consequences of the COVID-19 pandemic and regional crises. Addressing this decline is of utmost importance to safeguard the well-being of workers and foster sustainable economic development within the region.

Briefing note | 17 July 2023
This policy brief provides a comprehensive analysis of the nominal and real minimum wages in the Asia-Pacific region between 2015 and 2022. By considering the impact of inflation, real minimum wages offer valuable insights into the purchasing power of workers over time and their economic well-being. The study focuses on 22 countries in the region with available data on minimum wage systems.

Findings reveal a positive trend in real minimum wages prior to 2020, with an average annual increase of 2.5 per cent across the selected countries from 2015 to 2019. However, a shift in the trend occurred in late 2020, as real minimum wages started to decrease due to irregular and less significant adjustments coinciding with the inflationary impact of the COVID-19 pandemic and other regional crises. As a result, 15 out of the 22 countries experienced a decline in the minimum wage purchasing capacity between 2020 and 2022, with some countries witnessing significant decreases ranging from 2.2 to 44.7 per cent.

This policy brief underscores the significance of addressing the declining trend in real minimum wages and highlights the need for comprehensive measures to safeguard the well-being of workers and foster sustainable economic development in the Asia-Pacific region.