Raising The Minimum Wage?

The topic of raising the minimum wage has many different viewpoints. It is thought to be affected negatively and positively. Some believe it increases unemployment and poverty. Others believe it creates jobs, helps the economy and low-income families by giving them more money to give back to the economy.

Sklar provides numerous statistics in the article including that the wealthiest 1% of Americans hold 23.5% of the revenue in the United States (Sklar, 2009, p. 2). Moreover, “average wages are 7% lower today, adjusted for inflation, than they were in 1973” (Sklar, 2009, p. 2). Indeed, statistics are provided to support that unemployment rates do not rise when the minimum wage is raised. In fact, the Fiscal Policy Institute analyzed that “states that raised minimum wages above the federal level experienced better employment” (Sklar, 2009, p. 2). As people have more money, they spend that money on necessities. Hence, as the minimum wage rises, people will have more purchasing power causing an improved economy through spending. The article continues to provide statistics that demonstrate previous minimum wage increases have resulted in sizeable economic spending to boost the economy. These are persuasive statistics in favor of raising the minimum wage.

With the minimum wage set at $7.25 dollars per hour many people are struggling to make do. The average cost of living in America is too much for people, who make minimum wage, to make ends meet. It’s thought that raising the minimum wage will have a negative effect on the unemployment rate but there has been no evidence of that. The value of the minimum wage has dropped immensely since 1960. Raising the minimum wage will be beneficial to America and its citizens. In 1968 the minimum wage was equal to $10.74 today. That means in 50 years the purchasing power of the minimum wage has diminished. From the end of WWII upto 1968 minimum wage was on pace with the average worker productivity rate. If this trend was true from 1968 to today and worker

James Sherk, a Senior Policy Analyst in Labor Economics, stated in an article, “Higher minimum wages also make working in such jobs more attractive, drawing scores of workers with outside sources of income into the labor market. Many suburban teenagers and college students enter the job market when the minimum wage rises. As they apply for job openings, they crowd out urban teenagers and disadvantaged adults who would have sought the jobs at the previous wages” (Sherk, “What is Minimum Wage: Its History and Effects on the Economy”). Whenever the minimum wage rises, more people are inclined to work to gain additional money, however, many of these people already have an outside source of income and do not need the extra work. These people frequently push out the people who sincerely need the work and would have gladly accepted the jobs at the previous wage. Thus, although this raise will attract more people into the workforce, they often overrule those who could benefit from the pay. Furthermore, supporters of raising the federal minimum wage contradict that more money in the pockets of low-wage workers means more sales, which, in turn, creates faster growth and more jobs. A study

This paper examines several articles about the minimum wage in the United States (U.S.) for any gaps that may have gone unnoticed. In research, there will always be questions that a reader may want to understand or have clarified. The questions in research are those that a researcher deem necessary for a particular topic in order to complete a study. Of course, some questions within a study may be one sided, due to the researcher’s knowledge of the topic or the questions results from a previous study that was unanswered. Often times, a research may not have all the questions at that particular time, which leaves room for future studies. This paper evaluates several articles that may fall into this category. The first section review articles

Quinn and Castle explains why the government should raise the minimum wage and why it’s just common sense. They emphasis that it’s time for Congress to move ahead with this issue, one broadly supported by Americans before the article begins. The authors even show how as of today, as many as three quarters of Americans support an increase in minimum wage, with data polls disclosing majorities of Democrats, Independents, and Republicans in favor of the much need increases in the minimum wage. The authors also explain that by raising the minimum wage how it would save taxpayers billions of

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

Today, the minimum wage conversation is becoming an increasingly controversial, yet common topic. Many people are unsympathetic concerning the idea of a “living wage”, and they often belief that individuals should go to college or learn a trade if he or she wants a living wage. However, some individual’s life circumstances do not allow for opportunities that you or I have. Additionally, many individuals are misinformed about who the minimum wage increase actually benefits.

The economic status is unstable, and every politician who runs for office would explain their solutions for our economic crisis by creating jobs and raise wages. Recurrent debates over this topic convinced many people to believe raising the minimum wage is the key for financial problems. However, the consequences resulted in this solution will make matters worse. People are ignoring the contradictory logic between “creating jobs” and “raise wages”. These two terms are opposite from each other, in fact, raise the minimum wage will not only damage small businesses but also reduce employment.

In public discussion, the minimum wage is a frequent topic debated by policymakers; in the recent presidential campaign, candidate Bernie Sanders even made a $15.00 an hour minimum wage part of his platform. According to Adam Smith’s theory of economics, the invisible hand of market forces, or bargaining between employers and employees, should lead to a fair wage (Ryan 3). However, a significant amount of evidence points shows that market forces are not enough for some to sustain the cost of living. The minimum wage is shown to improve overall standard of living, mitigate economic inequality, and has few negative externalities, despite the arguments of those against the minimum wage such as job loss, loss of profit, and trust in market forces. The minimum wage is necessary, and the most efficient wage policy keeps a person out of poverty, adjusts for cost of living, and is as location-specific as possible.

Although it is not a new topic in America, the decision to raise the minimum wage continues to be controversial, especially in the political realm. The political parties still move to block the opposing party from successfully implanting their ideals, causing either nothing to be accomplished or the situation to worsen. Research shows that raising the minimum wage a reasonable amount would lessen the gap between the rich and the poor, continue to fulfill its original purpose of protecting workers and keeping the economy in a healthy state, and contain more advantages with a minute influence on employment rates.

The topic I've decided to do a research paper on is “Who really benefits from the raising of minimum wage?”. For this topic I will be discussing both sides; the employer and the employees, about the advantages and disadvantages on raising the minimum wage. Throughout the paper I will include examples on what would occur due to the minimum wage increasing; such as poverty numbers, employment cuts, and inflation to the economy.

Furthermore, imposing an employer mandate to comply with paying a higher minimum wage will have negative consequences on the labor market. What makes this topic important is that former President Obama passionately rallied for a hike in the federal minimum wage which never actually happened, but generated pressure on the states to take action. However, the major reason the new wage hike is going nowhere on a federal level is that the net effect costs jobs by businesses handing out layoff notices to the least productive employees and reducing working hours to compensate for the higher wages.2(p15) According to the data, "The typical study finds that a 10 percent increase in the minimum wage depresses teenage employment between 1 and 3 percent.” 3(p13) Consider the scenario where a teen is applying for his first job. He has no work history and has few technical skills. At the minimum wage rate of pay, he may find entry-level work, but at fifteen dollars an hour employers will look for already skilled workers with more experience. Indeed, Professor Holzer, a graduate of Harvard University in American economics, verifies that “Many employers will be very reluctant to pay high wages to workers whose skills … are so modest.”4 Increases in hourly wages do not work well as an anti-poverty measure considering that monetary incentives will attract highly-skilled workers, which leave less-skilled workers not only without a job, but also with less of an

In a paper titled “Four Reasons Not to Increase the Minimum Wage,” the Cato Institute, a libertarian think tank, offers four empirically backed consequences of increasing the minimum wage; these consequences include: the loss of jobs, low skilled workers being disproportionally affected and priced out of the job market, a minimal effect on reducing poverty, and higher prices for goods. The paper compiles a number of studies to support these

The minimum wage is the lowest legally accepted pay that employers are allowed to compensate employees. When this labor law policy was passed, it was accompanied with preconditions. There was a certain level of required skills needed by an employee to benefit from the minimum wage. This paper seeks to look into how minimum wage affects unemployment. From various studies in the literature review on this matter, most of the findings state that minimum wage regulations lead to an increase in unemployment. This is because those who are unskilled are mostly left out since they do not meet the production levels required in the labor market.