Negative Effects Of Increasing Minimum Wage

Minimum wage is the least amount of money that an employer is legally required to pay an employee. It is something that all people in the American workforce know about. It was made to prevent the employer from taking advantage of employees. It is what creates the bare minimum standard of living for the 73.9 million hourly wage workers in the United States. However, there are many different jobs with varying amount of skills that are needed for those jobs. This is where the problem arises because a worker may still be under paid for the job that they do. This problem splits the population into two main groups, one that wants the minimum wage to be raised and another that wants the minimum wage to remain the same, or to even be abolished.

Let’s start with the definition of the minimum wage. Minimum wage is defined as a legally mandated price floor on hourly wages, below which non-exempt workers may not be offered or accept a job (Minimum Wage 2015).

Minimum wage is the amount of money that the government says is the least amount that a business can pay to an individual. The debate on raising minimum wage has been ongoing for a long time. In my opinion minimum wage should not be raised. If minimum wage was raised then there would be higher unemployment because businesses wouldn't be able to afford hiring someone. Raising the minimum wage would mean that the businesses will pay higher than equilibrium price and this means that there would be a surplus. Whereas if the price was below equilibrium price than it would cause a shortage. A business would have to increase the price of their products or services. This would be known as inflation. This would lead the unemployment rates to go up because

Minimum wage is the lowest payment permitted by law or special agreement (labor union). Minimum wage jobs are normally designated for young adults or teens. It does not really permit a suitable living wage for a person with a family. The jobs with minimum wage are learning positions. They enable the worker to gain skills for higher paying jobs. Raising the minimum wage presents a series of advantages and disadvantages to the worker and the economy.

Although, the minimum wage is not the same in all place in the States, almost all those who are depending on it are unsatisfied and are hoping for a rise even though some people see the rising as risky. In 1992, Card David wrote an article about Using Regional Variation in Wage to Measure the Effects of the Federal Minimum Wage. He pointed out that '' arise in the federal minimum wage will typically affect a larger fraction of workers especially teenagers in some states than in others. That variation across states depend on the fraction of workers initially earning less than the new minimum.'' (Card David 1) He agreed that many States had already passed state – specific minimum wages above the new federal standard. As a result, the fraction

Who gets paid the minimum wage? Well, at some point in our lives we all have been paid the minimum wage. But who are those people earning the minimum wage right at this moment? These are the people who have menial jobs. They work in restaurants, retail stores, bars, and maintenance services (OEA, 9). In 2014, the city of San Francisco proposed an initiative indicating that it would raise the minimum wage to $15 by 2018 (Ballotpedia). So would a typical low-wage worker and low-income family benefit significantly from a minimum wage increase? It would probably help them but not that significantly. In today’s economic standing, people earning the minimum wage are considered below the poverty level if living in San Francisco. In my opinion, the minimum wage increase will give a slight rise to the quality of life for those working on minimum wage as well as their families and could potentially result in narrowing the income inequality gap for workers.

Minimum wage is the standard amount the government sets as the lowest an employer can pay an individual per hour. A low minimum wage can be unsustainable if it does not meet the cost of living also known as a living wage. Living wages should not only apply to employees of companies who are engaged in business with businesses or government agencies of that area, but it (living wages) should be made into law, that all business must provide a standard of living wage. Living wages should be supported by all government particularly both federal and state agencies across the board should be in agreement on this issue.

Heather Boushey, Executive Director and Chief Economist said, “The best way to fight poverty is to make sure people have jobs with decent wages that put them above the poverty line (Boushey, 2014).” Meaning that raising the minimum wage would help to reduce poverty. Raising the minimum wage to $10.10 an hour will reduce the poverty rate for non-elderly Americans to 15.8 percent from current 17.5 percent (Boushey, 2014). This increase would bring about 6.8 million people out of poverty.

Several decades of research have focused on the minimum wage and how it impacts low-income workers and the economy. While this phenomenon is not a new study, it is necessary to view the impacts from another perspective. The quality of life plays a vital role in the US.

Minimum wage is like price floor in economics. Right now it is set at $9.30 an hour. This is the absolute lowest a job can pay a worker. They are not allowed to go below this amount only above. If they do go below $9.30, then they can get in serious trouble. If a company was to raise the minimum wage from $9.30 to $10.30, more people are going to want more hours. Even though the workers would want more hours, the company would like to only

The definition of Minimum Wage is “an amount of money that is the least amount of money per hour that workers must be paid according to the law” (Minimum wage). Minimum wage, like other laws, are used to keep the economy in line. Minimum wage laws were invented in Australia and New Zealand with the purpose of guaranteeing a minimum standard of living for unskilled workers. (Linda Gorman) Minimum wage puts a price on the services one offers. Many different principles can be used to explain Minimum wage and explore the different aspects of it. Including what minimum wage does for our economy and the current status of it.

With a rise in minimum wage, Ronald faces a dilemma that is germane to what many companies in the U.S. are facing today. The subject of raising minimum wage is controversial because in order to achieve this, one party will benefit while the other will be negatively affected. As Mankiw notes, “Minimum-wage laws dictate the lowest price for labor that any employer may pay” (Mankiw, 2012, p.117). The impacts of the wage increase are two fold and affect each party differently. For current employees, the affect will be positive in the short-run, as they will receive higher incomes and subsequently receive a higher standard of living; prospective workers are also positively affected, in that with the rise in wage, there will be an increase in workers

Should the government raise minimum wage? Should the government lower or keep the current minimum wage? Minimum wage is a very controversial topic when it is discussed between all parties. For those arguing for minimum wage increase believe that it will bring people living below the poverty line above it. Former President Obama stated, “ no one working forty hours deserves to be living in poverty.” For those arguing against the raise on minimum wage believe that it has more negative effects than just causing citizens to lose jobs. However, I believe that the government should control the minimum wage and if it is to be raised than it needs to be done in a manner that wouldn’t negatively affect the individual or the

Raising the minimum wage to $10.10 is not the answer. The various amount of unintended consequences that would come about as a result is reason enough not to support an increase. Those who support an increase contend that it will alleviate poverty. Suppose a spike in the minimum wage does reduce poverty for some workers. This development will be offset since an increase in the minimum wage will further price out inexperienced workers from the job market, resulting in an increase in unemployment and thus, poverty. This can properly be described as a catch-22 situation; no matter happens, someone will lose. When you take these negative affects into account, is an increase in the minimum wage worth it? As expounded further, no it is not.

Minimum wage is the lowest hourly, monthly and daily salary that employers pay workers that is permitted by the law. Minimum wage can and is affecting different income earning. Minimum wage is based on the cost of living from the prior year. Raising minimum wage will benefit about 25 million workers across the country. The life of many americans is a day-to-day repeat. We wake up, prepare for our day, and off to our minimum wage jobs that never seems to pay enough for our living needs. No matter how hard he/she may work the pay remains the same. Many things needs to change in America and one of them being people time only being worth $10.50 an hour.