The minimum wage in Australia is much higher... about $US15 per hour depending on which "accord" (industry) you are in. Having lived and worked in the US, Canada, and Australia, I can attest that minimum wage earners *work* about 4x harder than they do here. You see, hundreds of people line up for jobs that they then try to *keep*, since you earn about $US30k per year on them. (That is about the median US salary.) And the unemployment rate is comparable or lower, and the debt is less, in part because there is less need for social services. (Australia is one of the lower tax OECD countries.)
This situation arose by a law passed in the early 80s that made it illegal for unions to campaign for pay raises without showing an increase in productivity. Businesses, in turn, had to pass on some of the increased earning from productivity gains. All of a sudden, we have unions and businesses on the same page, with unions responsible for their own worker productivity, and the amount of hours-per-year lost from industrial action was an order of magnitude lower than any other OECD country.
Neoliberal economics gets a lot right, but there is a flaw in its theory surrounding labour law. People are not replaceable units, and workers are "sticky", in that they have families and other commitments. This is not true for some industries (like some types of internet work), but it is mostly true. This sets up a very big power differential between businesses and workers, and a type of "prisoners dilemma" where individual businesses act in a way that is helpful to themselves but detrimental to the aggregate.