The Negative Effects Of The 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.

Franklin Roosevelt introduced minimum wage as a part of Fair Labor Standards Act of 1938. The purpose of minimum wage were to prevent poverty and to stimulate the economy by increasing consumer’s purchasing power. However, in 2015, 78.2 million workers were paid hourly, representing 58.5% of all workers in the United States. Among those people, 870,000 workers earned the minimum wage, $7.25 per hour and 1.7 million workers earned below the minimum. In total, 3.3% of workers earned exactly or below the minimum wage. For years, there have been heated debates about whether the government should raise the minimum wage. In 2016, California, New York, and Washington D.C. agreed to increase the minimum wage to $15 per hour. Some people think raising the minimum wage will decrease poverty and improve the workers living. Instead, raising the minimum wage will make the job market more competitive and it will increase the poverty level. When minimum wage was raised to $10 per hour, it benefited 16 to 24 million people while half a million workers lost their job. Rather than improving, Faces of $15 will damage the U.S economy and deeply hurt living condition of Americans.

Research shows if minimum wage was to climb that it would hurt the least skilled and the least experienced people trying to seek a job the most. There are different of opinions people believe in about the positive and negative aspect of minimum wage. Supporters argue that such a boost will shrink poverty without plummeting jobs and that it will boost confidence, increase the normal living, and cut inequality and have businesses to be well-organized. Opponents that are not for minimum wage say it will increase poverty, unemployment and is not good toward businesses. The question about minimum wage and the effects it would cause if it was to rise, remains one of the most commonly studied topics.

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.

Ultimately, having a minimum wage provides the working class with economic equity which is one of our seven major economic and social goals. I think that the minimum wage is important so that an employer cannot chose to pay his or her workers less to increase his own profit. When the minimum wage was first created by the Fair Labor Standards Act in 1938, the price was twenty five cents per hour. This price has increased immensely over the many years, but I believe it should be raised further. The minimum wage was designed to protect workers and the best way to ensure their protection is by rewarding them with satisfying wages that they can make a living

"If we took away the minimum wage, we could wipe out unemployment completely because we would be able to offer jobs at every possible skill level."

Introduced in 1938 as part of the Fair Labor Standards Act to help with the Great Depression, the minimum wage was the first form for federal action to make sure employers are paying their labors. Started at just $0.25, the current federal minimum wage is $7.80, but many states have their own minimum wage, some higher than the federal minimum wage and some lower. The minimum wage makes sure that the workers have a sustainable income and are not paid very low. Unfortunately, in this time period, the current minimum wage is not enough to survive without extra income. Kevin A. Hasset and Michael R. Strain point this fact out in their article The minimum-wage debate, “In addition, workers who earn the minimum wage are generally not the primary

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

Increasing the legal minimum wage affects the supply and demand side of the economy differently. The people hurt by an increase in the legal minimum wage include producers, taxpayers, and consumers (Brown, 489).

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).

Minimum wage is the topic I chose because there has been a controversy regarding raising minimum wage and the impact of minimum wage to the society. Whether it would aid workers or not. There have been arguments of laypersons of increasing minimum wage to a very high level and there are arguments against it.

Minimum wage has been a major discussion in our country approximately two dozen times ever since it was instituted in 1938 with the Fair Labor Standards Act. In the beginning, employers complained and argued because of their mindset that the raise was now another “cost.” Now, none of them have complained because they can afford to send their children to high quality colleges and they can take a Sunday drive in their Cadillacs. They did not see in 1938 that the raise is not a “cost,” as they had considered it. It allows for a decrease in poverty, and allows companies who can rise with the economy to thrive while those who cannot now leave an opening for a company who is willing to follow the new guidelines successfully.

First instituted in 1938, the minimum wage was first established during the Depression under the Fair Labor Standards act. Starting at only thirty-eight cents, it was a way to protect workers from exploitation. Most workers in that time were forced to work in horrible conditions for very low wage. The very Act that once helped so many people really be the culprite that is hurting those same people if the minimum wage was raised. At a mere seven dollar and twenty five cents an hour, the current minimum wage, who knew that such a debate among economic experts with detailed analysis showing that employment would actually take a negative

Minimum wage is the lowest amount of hourly or monthly salary that employers may legally pay to employees. Before minimum wage was enforced, employers would take the advantage of young and minority workers by underpaying them but now employees are protected by the law to receive a certain lowest amount for their jobs. The topic of how a minimum wage impacts the economy is one of the widely studied and most controversial topics in labor economics. There has been a significant amount of discussion regarding how minimum wage can impact employment and economic growth in short run and long run.

The controversial topic about increasing minimum wage is debated countless times over the years. Minimum wage is the lowest wage an employer can pay an employee permitted by law. The contemporary federal minimum wage is $7.25. Minimum wage applies to all domestic workers but teenagers are the main receivers of minimum wage. Minimum wage has a major effect on the economy. The question is are the effects positive or negative. There are many arguments on whether minimum wage should be increased or not increased. It is a major debate topic around the country. Although increasing minimum wage raises standard living and cause a growth in the economy, minimum wage should not be increased because it is difficult for low skilled worker to find work, many people will lose their jobs and service and goods will become more expensive.