No, Switzerland will not be enacting the world’s highest minimum wage

posted at 6:01 pm on May 19, 2014 by Erika Johnsen

Switzerland has consistently resisted some of the more blatantly progressive-populist-socialist impulses that have gripped many of their continental neighbors — joining the 28-members of the European Union and their unified currency system springs immediately to mind — and the Swiss once again just declined the growing trend to implement their own top-down minimum wage in a national referendum over the weekend.

Swiss voters resoundingly rejected on Sunday a proposed minimum wage that would have been the world’s highest, a move widely seen as reflecting an aversion to state intervention in the liberal economic policies that are the bedrock of Switzerland’s prosperity.

Trade unions had sought a minimum hourly wage of 22 Swiss francs, or $24.65, in what they said was an effort to ensure fair salaries for workers in the lowest-paid sectors, such as retailing and personal services. Switzerland has no national minimum wage.

The proposed rate — considerably higher than elsewhere in Europe and more than double the $10.10 President Obama has sought in the United States — found little support in a national referendum, with 76.3 percent opposed, according to initial results released by the government. …

“Switzerland, especially in popular votes, has never had a tradition of approving state intervention in the labor markets,” said Daniel Kubler, a professor of political science at the University of Zurich. “A majority of Swiss has always thought, and still seems to think, that liberal economic principles are the basis of their model of success.”

A lot of Switzerland’s industries already have individualized collective bargaining agreements with their respective workers, but Swiss Big Labor has been trying to argue that in a handful of job areas, wages haven’t kept up with high cost-of-living increases. Meanwhile, businesses have countered that the country’s relative labor freedom helps to maintain its economic dynamism, and that a national minimum wage would lead to job losses, especially among unskilled workers, while eroding competitiveness. Most Swiss voters evidently agreed, and clearly, Switzerland is doing something right compared to its neighbors:

The Swiss cabinet, known as the Federal Council, and both houses of Parliament urged voters to reject the measure, saying it didn’t take into account regional and sector differences that might merit different pay. They also said the minimum wage would make it more difficult for low- and unskilled job seekers to find work.

Business lobby Swissmem said state control of pay would be a “flawed experiment” with the potential to undermine collective wage agreements in place in most industry sectors. Opponents also said Switzerland’s employment system, which relies heavily on apprentice programs, would be undermined by the minimum wage. The youth unemployment rate in Switzerland is 3%, compared with 23.7% in the surrounding euro zone.


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Ah, that’s too bad.

Cindy Munford on May 19, 2014 at 6:09 PM

Most Swiss voters evidently agreed, and clearly, Switzerland is doing something right compared to its neighbors:

In other words, THE SWISS AREN’T STUPID!

GarandFan on May 19, 2014 at 6:09 PM

Now, if only we could get people in this country to be even half as smart as the Swiss on economic matters.

Bitter Clinger on May 19, 2014 at 6:10 PM

The proposed rate — considerably higher than elsewhere in Europe and more than double the $10.10 President Obama has sought in the United States — found little support in a national referendum, with 76.3 percent opposed, according to initial results released by the government. …

This is misleading.

Adjusting to purchasing power parity, $25 in Switzerland are the equivalent to $14 in the USA.

joana on May 19, 2014 at 6:10 PM

The median hourly wage is about $37 an hour.

The unemployment rate in Switzerland is a ‘whopping’ 3.2%.

“If the initiative had been accepted, without doubt that would have led to job cuts, particularly in remote and structurally weaker regions,” Swiss Economy Minister Johann Schneider-Ammann said at a news conference. “The best remedy against poverty is work.”

Resist We Much on May 19, 2014 at 6:12 PM

The youth unemployment rate in Switzerland is 3%, compared with 23.7% in the surrounding euro zone.

That’s an accomplishment that definitely should be touted loud and clear.


lineholder on May 19, 2014 at 6:14 PM

This is misleading.

Adjusting to purchasing power parity, $25 in Switzerland are the equivalent to $14 in the USA.

joana on May 19, 2014 at 6:10 PM

Which is still way too high for the minimum wage to be anywhere.

Bitter Clinger on May 19, 2014 at 6:15 PM

Utopia DENIED!

Bishop on May 19, 2014 at 6:16 PM

Even more interesting.

Total government expenditures as a % of the GDP:

Switzerland 2006 – 34.4%
USA 2006 – 34.6%

Switzerland 2013 – 32.9%
USA 2013 – 38.8%

Switzerland has also achieved budgetary surplus in every fiscal year since 2006.

joana on May 19, 2014 at 6:16 PM

…they need more illegal immigrants!

KOOLAID2 on May 19, 2014 at 6:17 PM

Just California…

Oil Can on May 19, 2014 at 6:19 PM

Told you so folks (when this news was first posted here a few weeks ago).

Nor will we buy a new fighter plane (The Grippen).

And in retaliation to the American attacks on our banking system (secrecy) the Swiss people will neither accept to buy American planes (or cars etc) in the future.

That’s the result of an irresponsible obama administration pissing off half the world, including the Swiss citizens.

Switzerland is a REAL democracy : WE THE PEOPLE decide !

coolapic on May 19, 2014 at 6:21 PM

“A majority of Swiss has always thought, and still seems to think, that liberal economic principles are the basis of their model of success.”

It should be noted that in Switzerland, like neighboring France, “liberal economic principles” means liberty of free enterprise, or “laissez-faire” capitalism, where the government stays out of private businesses. “Liberals” in Switzerland do not embrace that government-controlled nanny state that “liberals” in the USA propose.

With a 3% youth unemployment rate, the Swiss wisely voted that “if it works, don’t fix it.”

Steve Z on May 19, 2014 at 6:22 PM

…they need more illegal immigrants!

KOOLAID2 on May 19, 2014 at 6:17 PM

Can we export some of ours to them?

Bitter Clinger on May 19, 2014 at 6:22 PM

No, Switzerland will not be enacting the world’s highest minimum wage

Alernate headline: Cheer up De Blasio- You still have a shot.

Happy Nomad on May 19, 2014 at 6:23 PM

Even more interesting.

Total government expenditures as a % of the GDP:

Switzerland 2006 – 34.4%
USA 2006 – 34.6%

Switzerland 2013 – 32.9%
USA 2013 – 38.8%

Switzerland has also achieved budgetary surplus in every fiscal year since 2006.

joana on May 19, 2014 at 6:16 PM

It’s not that interesting. Switzerland is culturally homogenous. They have a 3% unemployment rate, they don’t have whole swaths of people living decade to decade on welfare. They still have a national identity, they’re not some ‘melting pot’ that we think is so wonderful. Is it any surprise they’re dominating? Not to me, but give them a few more decades of Muslim influx, and watch them go to hell just like GB, Netherlands, etc…

nullrouted on May 19, 2014 at 6:25 PM

Well just what do those hicks know about it anyways???

….Wait, isn’t this about some state out in Jesus Land Territory???

BigWyo on May 19, 2014 at 6:28 PM

nullrouted on May 19, 2014 at 6:25 PM

Bingo! Culture matters. Ours sucks. What would de Tocqueville say?

Chuck Ef on May 19, 2014 at 6:31 PM

Now, if only we could get people in this country to be even half as smart as the Swiss on economic matters.

Bitter Clinger on May 19, 2014 at 6:10 PM

We may be too chocolate deficient…

trigon on May 19, 2014 at 6:43 PM

The Swiss went to the Austrian School!

jdpaz on May 19, 2014 at 6:43 PM

Trade unions had sought a minimum hourly wage of 22 Swiss francs, or $24.65, in what they said was an effort to ensure fair salaries for workers in the lowest-paid sectors, such as retailing and personal services. Switzerland has no national minimum wage.

Well then, they must be the Keystone Kops of trade unions. They need to take a lesson or two from the Fabian Socialists running our trade unions and go for incrementalism. They gave the frog a chance to jump out of the pot by going for too much too quickly. You have to lull the populace to sleep first.

Cleombrotus on May 19, 2014 at 6:44 PM

It’s not that interesting. Switzerland is culturally homogenous. They have a 3% unemployment rate, they don’t have whole swaths of people living decade to decade on welfare. They still have a national identity, they’re not some ‘melting pot’ that we think is so wonderful. Is it any surprise they’re dominating? Not to me, but give them a few more decades of Muslim influx, and watch them go to hell just like GB, Netherlands, etc…

nullrouted on May 19, 2014 at 6:25 PM

The USA has been a ‘melting pot’ for a long time. That metaphor came to usage in the late 19th century. That didn’t stop America from becoming one of the most powerful economic forces in the history of human civilization.

Switzerland is a bit of a melting pot as well. 25% of the population is foreign born. The naturalization rates have been climbing and about 7% of the Swizz citizens are naturalized. Almost 30% of resident foreigners acquire Swiss citizenship. They have 4 official languages. There’s no such thing as a homogeneous religion.

On the other hand, you have countries far more culturally homogeneous than Switzerland with a high government spending/GDP rate (Sweden, Denmark, Finland, etc) and countries with plenty of demographic and cultural diversity like Singapore keeping very low rates of government spending. Or Australia, for example, another melting pot and their government spending/GDP ration is already lower than ours.

In other words, the idea that cultural homogeneity is an explaining factor on this is completely bogus. There’s not even a correlation, let alone a causation. In fact, the standard economic theory is that culturally homogeneous societies tend to be more tolerant of high levels of government spending and welfare.

joana on May 19, 2014 at 6:45 PM

amazing what a monoculture can accomplish.

Murphy9 on May 19, 2014 at 6:46 PM

It should be noted that in Switzerland, like neighboring France, “liberal economic principles” means liberty of free enterprise, or “laissez-faire” capitalism, where the government stays out of private businesses. “Liberals” in Switzerland do not embrace that government-controlled nanny state that “liberals” in the USA propose.

With a 3% youth unemployment rate, the Swiss wisely voted that “if it works, don’t fix it.”

Steve Z on May 19, 2014 at 6:22 PM

That’s what liberalism means in most of the world.

joana on May 19, 2014 at 6:47 PM

Switzerland and India are smarter than the entire once free world, together.

OT – animals

Schadenfreude on May 19, 2014 at 6:50 PM

Much of Europe has reformed their tax-and-spend ways. That’s the great untold story of the last 10 years.

Meanwhile, the U.S. has forfeited its competitive advantage at the same time.

will77jeff on May 19, 2014 at 6:52 PM

In other words, the idea that cultural homogeneity is an explaining factor on this is completely bogus. There’s not even a correlation, let alone a causation. In fact, the standard economic theory is that culturally homogeneous societies tend to be more tolerant of high levels of government spending and welfare.
joana on May 19, 2014 at 6:45 PM

It depends on which culture you’re speaking of. The US, at one time WAS culturally homogenous even though we were never ethnically homogenous. The culture of most Scandinavian countries is Western socialist. Is Switzerland socialist in their economic practices?

Cleombrotus on May 19, 2014 at 6:56 PM

It depends on which culture you’re speaking of. The US, at one time WAS culturally homogenous even though we were never ethnically homogenous. The culture of most Scandinavian countries is Western socialist. Is Switzerland socialist in their economic practices?

Cleombrotus on May 19, 2014 at 6:56 PM

What does that even mean? Isn’t it obvious that Switzerland isn’t socialist in their economic practices? My comment on their spending/GDP ratio wasn’t a clue?

Multicultural countries like the Switzerland, Australia, Singapore, Canada and the US are far less socialist in their economic practices than culturally homogeneous countries like Sweden, Portugal, Spain, Greece, Denmark, etc.

joana on May 19, 2014 at 7:00 PM

Erika, whatever happened to their vote on a “guaranteed income”? Do you know? I remember hearing a lot about it last Nov./Dec. In particular, news stories always mentioned the vote was “happening soon” but then they never reported the result. I presume it was defeated.

will77jeff on May 19, 2014 at 7:01 PM

@Cleombrotus:

most on this site would consider their healthcare policy ‘socialist’

Switzerland is what we could have if we deported everyone that achieved below 1300 on the SAT and only let in those who score 1450 or more on the SAT.

@joana: good post above.

uatu1878 on May 19, 2014 at 7:01 PM

Why do the Swiss hate the poor?

Another Drew on May 19, 2014 at 7:06 PM

We should copy the swiss in all things. I would trade my passport for a swiss one anyday of the week.

uatu1878 on May 19, 2014 at 7:09 PM

We should copy the swiss in all things. I would trade my passport for a swiss one anyday of the week.

uatu1878 on May 19, 2014 at 7:09 PM

Switzerland, Australia, even Canada–all have realized what it takes to be a successful society: strong property rights, limited immigration, federalism. Only the US thinks that massive 3rd World chain immigration leads to prosperity.

will77jeff on May 19, 2014 at 7:12 PM

This is misleading.

Adjusting to purchasing power parity, $25 in Switzerland are the equivalent to $14 in the USA.

joana on May 19, 2014 at 6:10 PM

The median hourly wage is about $37 an hour.

The unemployment rate in Switzerland is a ‘whopping’ 3.2%.

“If the initiative had been accepted, without doubt that would have led to job cuts, particularly in remote and structurally weaker regions,” Swiss Economy Minister Johann Schneider-Ammann said at a news conference. “The best remedy against poverty is work.”

Resist We Much on May 19, 2014 at 6:12 PM

It’s convenient these two comments follow one another. Together, they prove that higher wages do not necessarily translate to a higher standard of living.

They also prove that not mandating a minimum wage does not hurt the average worker while also improving the job market.

Steve Eggleston on May 19, 2014 at 7:18 PM

The one thing that really stuck out to me was the comment about heavy reliance on apprenticeship programs instead of expensive collegiate programs. What happened to learning a trade from a master of it, where you learn what you actually need and gain experience at the same time? Makes a hell of a lot more sense than spending years learning skills irrelevant to any occupation, before starting working while hundreds of thousands of dollars in the hole.

Asurea on May 19, 2014 at 7:29 PM

Erika, whatever happened to their vote on a “guaranteed income”? Do you know? I remember hearing a lot about it last Nov./Dec. In particular, news stories always mentioned the vote was “happening soon” but then they never reported the result. I presume it was defeated.

will77jeff on May 19, 2014 at 7:01 PM

That vote hasn’t happened yet. Nobody knows when it will happen.

Steve Eggleston on May 19, 2014 at 7:37 PM

somebody page coolpubica and give her the bad news. not long ago she was debating the matter vigorously, splaining to the mortals here how Switzerland is this bastion of socialism :)…swizterland, of all countries in europe :)..

jimver on May 19, 2014 at 7:45 PM

The youth unemployment rate in Switzerland is 3%, compared with 23.7% in the surrounding euro zone.

Well at least they don’t know chocolate, or weapons.

WryTrvllr on May 19, 2014 at 7:53 PM

joana on May 19, 2014 at 7:00 PM

The question was rhetorical; meant to illustrate my point.

Cleombrotus on May 19, 2014 at 8:18 PM

Man those Swiss sure are racist and really hate poor people.

Who knew.

KMC1 on May 19, 2014 at 9:01 PM

Makes perfect sense

Gwillie on May 19, 2014 at 9:39 PM

Will my liberal friends still say we should be more like the Swiss? Of course they will, then call me a lair when I mention this vote.

Gwillie on May 19, 2014 at 9:40 PM

Will my liberal friends still say we should be more like the Swiss? Of course they will, then call me a lair when I mention this vote.

switzerland doesn’t really follow the american conservative-liberal paradigm. It’s characteristics would infuriate both.

Which probably means it is doing something right.

uatu1878 on May 19, 2014 at 10:15 PM

switzerland doesn’t really follow the american conservative-liberal paradigm. It’s characteristics would infuriate both.

Which probably means it is doing something right.

uatu1878 on May 19, 2014 at 10:15 PM

That is actuallly quite accurate about Switzerland.

jimver on May 19, 2014 at 10:38 PM

It depends on which culture you’re speaking of. The US, at one time WAS culturally homogenous even though we were never ethnically homogenous. The culture of most Scandinavian countries is Western socialist. Is Switzerland socialist in their economic practices?

Cleombrotus on May 19, 2014 at 6:56 PM

I have lived on Switzerland periodically for the better half of two decades.

Switzerland is like America with very diverse regions and cultures. You can go from “liberal” french speaking Geneva to ultra-conservative german speaking Appenzell Innerrhoden (which reluctantly gave women the right to vote in 1991!). Most of the country though is very protective of its Swiss identity.

Immigration is a HUGE issue here, but the good guys are winning. The rise of the rightwing Swiss Peoples Party and the recent EU immigration vote are clear symptoms of this.

Unfortunately, I can’t say the same with the US, with worthless RINOs like Boehner & Co pushing for amnesty.

Norwegian on May 19, 2014 at 11:06 PM

So who actually came up with this? Obviously there was enough of the PTB over there in order to get it put to a national referendum.

Whoever was behind this will be back. They won’t be going away. Socialists never just “fade away”.

Dr. ZhivBlago on May 20, 2014 at 4:51 AM

Things liberals would hate about Switzerland: no Minimum wage, lower taxation, gun policy, immigration policy, minaret ban, mandatory service.

Things conservatives would hate about Switzerland: Health Care System, Defense spending, Gas Tax, Carbon Tax, gun policy (no conceal carry, gun registry, other restrictions that would never pass here on a national basis), capital punishment banned, assisted suicide legal, nimby-ism which keeps real-estate prices back-breakingly high.

I’ve seen a few swiss articles on HA within the last year or two and most posters wade in to laud swiss economic policy.

However, I also think most of these posters have never lived there for any period of time and I think if they did, 85% would hate it and would want to come back to the US.

uatu1878 on May 20, 2014 at 8:50 AM

It must be repeated, lest the trolls usurp and trumpet the term, that in this statement:

“A majority of Swiss has always thought, and still seems to think, that liberal economic principles are the basis of their model of success.”

The term liberal means “unencumbered by government”, or “at liberty”, the correct classical usage of the word, completely unlike the current American and euro-socialist usage, which means “government regulation against business, and utterly libertine personal behavior”.

Freelancer on May 20, 2014 at 6:23 PM

@freelancer:

how do you explain santesuisse or carbon tax?

What must be repeated is this:

switzerland doesn’t really follow the american conservative-liberal paradigm. It’s characteristics would infuriate both.

Which probably means it is doing something right.

uatu1878 on May 19, 2014 at 10:15 PM

That is actuallly quite accurate about Switzerland.

jimver on May 19, 2014 at 10:38 PM

uatu1878 on May 20, 2014 at 7:01 PM

After Seattle raises its minimum wage to $15 per hour, maybe all the workers who lose their jobs can move to Switzerland.

Colony14 on May 20, 2014 at 9:36 PM