PNG's minimum wage

by Stephen Howes, Kingtau Mambon and Kelly Samof

September 28, 2022

The urban minimum wage has been an important part of Papua New Guinea's economic history. In the last few years before independence (in 1975), it was greatly increased. In the decade or so after independence, it was widely regarded as too high. In 1992, it was slashed, merged with the rural minimum, and hardly increased again for more than a decade.

We can compare the minimum wage in PNG today with other Asia and Pacific developing countries using International Labour Organization (ILO) data. 

As Figure 1 shows, PNG's minimum wage is 18% below the average of the 19 countries shown if the market exchange rate is used to compare minimum wages. 

It is 37% below the average if differences in cost of living are also taken into account (with conversions made on the basis not of market exchange rates but so-called purchasing power parities or PPPs). 

The greater difference in terms of PPPs reflects PNG's relatively high cost of living. Of the countries shown, only Samoa and Kiribati have a lower minimum wage than PNG when a PPP comparison is made.

READ FULL RESEARCHED ARTICLE HERE: https://devpolicy.org/pngs-minimum-wage-20220928/