Raising Minimum Wage

One of the biggest political topics in today's society is the federal minimum wage and whether it should be raised or kept at where it is now at $7.25 an hour. Arguments could be made for both sides on whether it should be raised or left alone. The majority of minimum wage in today’s job market are unskilled positions. Minimum wage jobs were created for teenagers and colleges kids as a way to get into the workforce and to have a little extra money for themselves. It was not designed to be a wage for people to live on. Increasing the minimum wage would hurt the economy by hurting small businesses, a huge loss of jobs and it would increase the competition between teens and adults. Overall if the federal minimum wage is increased it will have many negative effects on the economy.

“A 15 percent increase in the minimum wage nationwide would destroy about 290,000 to 590,000 young people's jobs, and about 400,000 to 800,000 jobs overall” (Henderson, David R). Due to the Fair labor Standards act, the federal minimum wage, or the lowest you can pay an employee for work, currently stands at $7.25 an hour. Although a number of Americans think that raising the minimum wage would benefit our country, it would actually bring a number of problems to our economy, such as a rise in job loss and high school dropout.

Several examples of data and statistics from studies elucidate the harmful effects on small businesses and in addition the compelling of companies to close as a result of the increase of minimum wage. According to a Gallup poll that took place in 2013, 60% of small business owners agreed that an increase in minimum wage would be harmful to their small businesses (Should the Federal). Small businesses do not have the money supply that chain corporations do. Naturally, if they had to pay their employees more, it would be harmful to them. Several Walmart stores have closed and Walmart stores that were yet to open have closed as a result of an increase in the minimum wage (Should the Federal). An increase in the minimum wage must even have harmful effects on larger businesses. They obviously employ several more people than a small business, so they have to pay each worker more resulting in a net loss of a lot of money from the chain. Additionally, in several work places, if the minimum wage were increased, the wages of those who hold higher positions would have to be increased. For example, if the amount of money that the minimum wage dishwasher or table busser in a restaurant increased, then the chef and manager would need to be paid accordingly. If the minimum wage were to increase, it would be detrimental to both small and large businesses.

An increase in the minimum wage would push companies to take this route as it becomes more and more profitable to them. The end result of all of this would be a suddenly increased level of unemployment bound to become subsequent with an increase in government-funded welfare expenses, weakening the economy even more.

The controversy over minimum wage has been ongoing. However, as explained in a Time article by Chris Lu on the subject, now is the prime time to raise the federal minimum wage. “Three out of four Americans support an increase; the economy is healthy; and many employers are already raising wages.” It’s reasonable to be worried about the consequences that raising the minimum wage might have in a time of crisis or unrest, but this quote mentions a healthy economy that would be able to handle the shifts in wages if things went south temporarily. Another argument made by opposers of raising the minimum is that businesses will be unable to survive. On the contrary, a good business will find it beneficial. “‘It’s a simple, but critical, concept: take care of your people and they will take care of your customers.’ For &pizza, higher wages reduce employee turnover, increase productivity and improve customer service.” Rather than hurting the economy, raising the minimum wage will help workers, business owners and the economy itself. A higher wage for all is

Beside the increase in cost to businesses and customers, other people can potentially be hurt by this policy. By increasing the wage, small businesses will suffer a higher cost that can lead to cutting jobs, stalling new hire or even shutting down. On the other hand, the economic plight of these minimum wage workers should also be considered. Therefore, the $15 plan would produce unpredictable consequences, while not doing anything would doom minimum wage workers to live in in poverty and to consume public resources.

A fifteen dollar an hour minimum wage will affect over three hundred thousand workers and cost over two hundred twenty eight million dollars over the next five years(Deng 1). San Francisco raised the minimum wage to fifteen dollars an hour. That being said The Mark Perry of the American Enterprise Institution, Adam Ozimek and Stephen Bronars of Edgewood Economics reported that since the increase many restaurants and hotels have laid off workers (Puzder 1). This comes as no surprise since in 2014 the Congressional Budget Office found that increasing the minimum wage to ten dollars and ten cents an hour would result in 500,000 job losses ( Puzder 1). As of right now 6.5 million Americans are working part time because they’re unable to find full-time jobs and opportunities ( Puzder 1). Raising minimum wage is only going to hurt those that are currently part time, unemployed and the upcoming generation of young adults just now about to enter the working

The topic on whether the minimum wage should be increased our untouched has been a hot topic in the media and political scene lately. Both the republicans and democrats have spent some big bucks lobbying their insights on the matter. There has been a lot of subjective and objective arguments that are reasonable on both the pros and cons of increasing our national minimum wage. To add to the drama associated with this topic, President Obama endorsed a bill proposing a nearly 40% rise from $7.25 to $10.10 per hour. The President has been campaigning around the country ever since his State of the Union address, pushing congress to raise the minimum wage to $10.10 an hour. Many say this is too high due to the costs of enacting such an increase, and many say this is a little low due to the increased cost of living. After looking into both sides of this debate, I realize that overall it would be better for the well-being of our nation to increase the minimum wage due to the short term and long term costs that an increase of the minimum wage could lead to. In terms of helping out the lower class and poor citizens of the United States, increasing the minimum wage level is not the answer.

“Raising minimum wage would generally mean that those who work for these wages would have more money to spend into small businesses…and that putting their money

In announcing his proposal to increase the minimum wage, the president argued that doing so would alleviate poverty. The president is certainly correct to turn his attention to the poor, many of whom have been suffering for years in a tough economy. And it is clearly desirable for households that engage in full-time work not to live in poverty. But increasing the minimum wage would

There are two sides to the minimum wage issue. Many small business are already struggling to make ends meet before the minimum wage was increased. The minimum wage being increased can cause goods for store to go up. Small business that are already barely making it, are going to need to pay workers close to $8,200 more a year, says NPR. Promotion 206 would slowly increase the minimum wage to 12. 00 dollars by 2020. For business that allows employees to be tipped are allowed to pay the employee up to 3. 00 below the minimum wage ,but as long as the tips that are earned are distributed to the employee would bring that rate at least up to the minimum wage. (ballotpedia) The rise and fall in minimum wage can help and hurt the economy both ways and how that works is very interesting. The big idea of raising minimum wage is to protect the worker at all cost and assume that the owner of the business is doing just fine. America is built on small business and this can damage the economy servilely.

As for small businesses being harmed by an increase in minimum wage, Batra proves that a rise in minimum wage, as long as it is not faster than the rise in prices, will not adversely affect the businesses’ profits. He says that a business’s profit equals the revenue, less wage costs and all other costs. Batra offers an example with a popular fast-food franchise:

Businesses will not just reduce the number of employees they will also seek to maximize their profit by reducing benefits. While most minimum wage jobs do not offer much in the way of benefits, many at least offer some form of incentive. In some cases it may be a free of reduced cost meal, others may offer at least some form of basic health plan or 401(k). The effect of raising the minimum wage is also disproportionate, affecting small businesses more than larger companies. This leads to a greater incentive for a small business to participate in the ""black market" for labor, by paying employees in cash in order to pay them less than

Like anything, labor is a commodity. It has costs, a fixed supply, and a shifting demand. The goal of any business is to find the equilibrium point of this commodity. For every business, that will be different. But if the minimum wage reflects social needs over economic needs, then it is artificial. Although the idea of Congress raising the federal minimum wage is well-intentioned, its effects on states with varying costs of living will be radically disproportionate, while a wage that is too high will lead to negative consequences for consumers, employees, and businesses alike without stimulating the economy, ultimately hurting the very people the wage hike seeks to help.

Increasing minimum wages cause people to need to lose their jobs. “Businesses will have to cut hours, hire and keep fewer employees, reduce benefits, and increase prices,” said Zack Hutchins, director of communications for the Business Council of New York State. Even though higher minimum wages sound amazing, many companies and businesses had to lay off many of their employees because of this. The people who support the raise and vote for it state that by doing this families can make end meet. However, Walter William, a professor at George Mason asked, “Is it likely that an employer would find it in his interests to pay a worker $15 an hour when that worker has skills that enable him to produce only $5 worth of value an hour to the employer's output?” As a result employers are less likely to hire inexperienced workers and teenagers and take away any chance for them to gain experience in the first place and leave them unemployed. If the minimum wage was $5-7 many more people would have jobs and experience.