My topic of interest is the effects of raising minimum wage in the U.S. Minimum wage is defined as the lowest wage permitted by law or by special agreement. In 1938, President Roosevelt signed a bill called the Fair Labor Standards Act of 1938, which set the minimum wage at $0.25. Although, overtime inflation devalued the amount of the dollar so it was raised there on. After raising the minimum wage the cost of living would keep going up every year. Also, currently advocates are arguing that the living wage should be 125% above the poverty line so that full time workers can afford a living.
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.
Raising minimum wages is a contestable issue because it is debated in wide and varied audiences. Minimum wage is near the top of economists’ interest; they are looking for the connection between low wages and poor job markets. Each country sets its own laws and regulations regarding wages. For this reason, it has significant importance to policy makers and workers in each of those respective countries. Social activists have also found interest in the topic due to the fact that those who earn a minimum wage tend to come from poor minority families. Furthermore, the average American should have the strongest interest in the conversation because most citizens have been paid a minimum wage at some point in their life. Due to this fact, the idea of a significant federal minimum wage increase in America is open for debate specifically to rejuvenate the job industry, improve living conditions for citizens, and strengthen the economy as a whole.
On July 24th, 2009, the United States of America raised the minimum wage to $7.25. However, six years later the minimum wage rage remains the same. It is time once again for the federal government to raise the minimum wage to spur the economy. Raising the minimum wage would help the American economy and the daily life of the citizens for a variety of reasons. The first topic is that it not only would help the people but it also would help the economy as a whole. The second topic is that companies are already raising the minimum wage because of the lack of money workers get. Finally the third supporting idea is that the states are also raising it over the federal minimum wage and also how can help poverty. There are many more topics on why the minimum wage should be raised but these reasons are the most important.
Millions of Americans live in poverty unable to find high paying jobs to support themselves and their families. A common belief is that paying a higher minimum wage would help lift people out of poverty by giving those with low paying jobs a higher income, however the evidence suggests otherwise. The 2016 race to the White House heating up, the minimum wage battle is at the forefront of every economic discussion. The rhetoric between candidates within and across party lines is intensifying. Many differing opinions are being heard. As the debate over whether or not to raise the federal minimum wage from $7.25/hour to $15/hour rages on, one side stands apart time and time again.
Raising the federal minimum wage to $15 an hour can have detrimental effects on society. Some issues that may arise are increases in unemployment and small businesses not being able to handle the financial burden, which will lead into job benefit cuts. Furthermore, a rise in minimum wage will cause inflation and businesses to raise the prices of their goods and services. People purchasing power will continue to stay the same; the struggle to close the gap between products and services will not
Minimum wage is the minimum hourly wage an employee can earn from work. President Franklin D. Roosevelt signed the minimum wage law on June 25, 1938. However, the United States has not always had a minimum wage. The United States minimum wage has been in effect since the Great Depression. Before then there was no minimum wage and there certainly were not any legislation to look after workers from development. Many of workers had to work in awful environments such as factories and sweatshops and they were only paid a few pennies a week. The minimum wage started at 0.25 cents per hour and the maximum workweek at 44 hours in 1938. As of today, the federal minimum wage is at $7.25 an hour, part of the Fair Labor Standards Act.
In the summer of 2014, legislature intended to raise the current minimum wage floor of $7.25 in the United States stalled in Congress. As the November election approaches, many Democratic senate members are placing the issue of minimum wage at the forefront of their election campaigns, hoping to sway working-class voters in their favor. The issue of minimum wage has become a matter of politics, politics which far overshadow the far more pertinent concern of minimum wage’s economic effects. Minimum wage is a complex issue, and understanding both the benefits and harms associated with minimum wage is critical to making an informed political decision, a decision hopefully substantiated by economics.
The current U.S. Federal Minimum Wage is $7.25 per hour. In just two years from 2013, the demanded from advocates for raising minimum wage rose from $9 to $15. However, raising the minimum wage is more complex than simply raising the number of federal standard of pay for employees. Relative control groups and other market activities play a part in the outcome of the minimum wage. For example, one instance of market activity was observers said that raising the minimum wage did not hurt individuals; however, wages were raised during an economic downturn so the impact of minimum wage was masked by other activities. Federal Minimum Wage is pressing topic and it is important to consider the pros and cons to raising it, to ask what people and how people are affected, and to look further into the microeconomic theoretical framework of wages surrounding the topic.
A minimum-wage increase would put billions of dollars into the U.S. economy, benefiting businesses. It may not result in a surplus, but it will benefit the economy. Workers who are affected in any way by the minimum-wage being raised even to just twelve dollars an hour would see nearly eighty billion dollars in increased earnings over the next five years. Because low-wage workers tend to spend increased earnings locally on basic necessities, this will benefit businesses that rely on consumer spending. It still won’t come close to the equilibrium price, but it will help. The minimum wage last year was twenty-four percent below the level it was just about fifty years ago despite the fact that American productivity has more than doubled over that period and low-wage workers now have much more experience and education than they did back then. Now it’s the time to address this weakness in the minimum wage by raising it and lifting the earnings of low-wage
Even though Ms.Steele considers the down fall of raising minimum wage, Mr.Knight provides clear evidence that raising minimum wage would help the America's economy.A 2011 study showed that increasing minimum wage lead to higher consumer spending.Another study showed that in the first six months of 2014 states that increased minimum wage, increased in jobs also.Last but not least, in 2014 University of Massachusetts Ameherst found that increasing minimum wage would lift 4.5 million Americans out of poverty and 3.5 million from food stamps.
Proponents of raising the minimum wage claim that if the minimum wage was raised, then many economic and social problems would be alleviated. This contention is at odds both with economic principles and years of creditable research. The effect of raising or even having a minimum wage has been studied extensively and the majority of studies have proven that raising a minimum wage does not have the desired effect. Both micro and macroeconomic forces affect the results of raising the minimum wage. The secondary effects of raising the minimum wage are bad both for
In 1938, the first national minimum wage laws in the United States were passed as part of the Fair Labor Standards Act, which served as “a floor below wages,” to reduce poverty and to ensure that economic growth is shared across the workforce. Today, many people who work for companies that pay at or near the minimum wage and remain near or below the poverty level rely on government health and food security and income programs to supplement their living expenses. Since 1938, there have been many additional policies to the Fair Labor Standards Act that have changed many things, such as increasing the national minimum wage numerous times to the currently salary level, which was set in 1997. The Fair Minimum Wage Act of 2007, from the United States Department of Labor Wage and Hour Division, was a policy to change the federal minimum wage from $5.15 to $7.25 in three additions, which began in July of 2009. (U.S., 2009).
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.
An increase of minimum wage can cause the effect of not reducing the poverty. It will only cause more problems because if wages go up then that would mean that the less experienced employers may not even get a chance to get a job since all the companies would look for experienced workers that would take it since they will pay them the “big bucks.” Thus, it would mean they would more likely pay them the higher wages than the less experienced causing people to lose more jobs.