Who Is the Minimum Wage Really Protecting?

Another simplistic view on what minimum wage is all about. For simplicity let us imagine a system that only has food items (ignore clothing, shelter etc. just a single product society) and it costs $10.00 per day to feed a person. What would happen if you pay that person $5.00 ... they would starve. Of course one could argue that market forces would intervene and the price of labour would increase (because there are fewer workers). Either people starve, or they commit crime, or they leave the workforce to grow their own food.

What if you double the minimum wage ... paying people $20. If 100 percent of the cost of food is the cost of labour, it would have no effect... food would cost twice as much while people get paid twice as much... zero gain. However it is usually the case that labour represents a small part of the cost. If labour represents 10 percent of the cost of an item, doubling their wages means they represent 20 percent of the cost. There are two ways that this resolves itself. The employer receives less or most often the price of the good increases.
So imagine that food cost $10.00 and the employee earns $10.00 per day and represents 10 percent of the cost ... than that means the employee creates 10 food items per day ... this means the employees costs $1 per food item created. Now the employee's salary is doubled to $20 per day. This means the employee costs $2 per food item. The price of food items would increase to $11.00 but the employee would still net $20-$11 = $9 additional dollars per day.

Compare countries like Canada which has a minimum wage and counties whose minimum wages are quite low. It is quite expensive to live in Canada. Homes need to be heated for a significant portion of the year. A significant portion of clothing needs to be for inclement weather. A significant portion of the year cannot be devoted to food production. In contrast consider many countries in tropical areas that do not have a minimum wage. The societies are divided between the very rich and the very poor. Things which Canadians take for granted ... education and healthcare are luxuries in countries without a minimum wage.

This interview of single Canadian business illustrates a different perception... the business voluntarily paid its employees more.
https://www.bnn.ca/canada/video/small-business-owner-welcomes-ontario-s-minimum-wage-hike~1295383/small-business-owner-welcomes-ontario-s-minimum-wage-hike~1295383

Governments represent the people (in theory) and when monopolistic companies have a stranglehold on wages and have disenfranchised labour unions, the government has the power to introduce legislation which can address the imbalance.