Investigating the European Union Minimum Wage Setting Mechanisms Through the Directive (EU) 2022/2041

Minimum wage is currently one of the most debated topics across economists, some claiming its negative implications on losing jobs, while others on dropping the poverty rate. Recently, the European Parliament and the Council adopted the Directive (EU) 2022/2041 on adequate minimum wages, with which the European Union countries will have to comply by November 15, 2024. The document aims to establish the framework and methodology to increase the minimum wage threshold within the European Union in order to achieve decent living and working conditions. Hence, this article aims to provide a clear overview on the Directive and to identify some examples of best practices on minimum wage setting mechanisms across the European Union. Indicators on gross minimum wage, GDP per capita, unemployment rate, and global gender gap index for the year 2022 were used in a country cluster analysis in order to identify some best practices across countries with more socio-economic similarities.