[zaarn]

I would argue that it is better to have 50% of the population on unemployment payments rather than having them employed under below-human-dignity wages. The later looks better on the statistics because those people are working.

The extreme scenario you propose is in my eyes an acceptable result of a minimum wage system, because implementing a minimum wage says "nobody should work and earn less than X$/h". For people unable to find work under these conditions we have social safety nets (well, the US doesn't but other countries do)