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Essay On Federal Minimum Wage

1261 Words6 Pages

The U.S. federal minimum wage was first established during the Great Depression, and it has risen from 25 cents to $7.25 per hour since it was first instituted in 1938 as part of the Fair Labor Standards Act (Wihbey). Currently, twenty-nine states and Washington D.C. have minimum wages above the federal minimum wage (DeSilver). The federal minimum wage is the lowest wage permitted by law. Those who support the increase of the federal minimum wage argue that the federal minimum wage has not kept up with inflation, promotes economic growth, and decreases poverty. Those who oppose the increase of the federal minimum wage argue that it would increase inflation, cause an economic decline, and increases poverty. Proponents of increasing federal …show more content…

While a minimum wage hike would benefit millions of workers with higher earnings, it would also hurt millions of others who would lose earnings because they cannot attain or retain a job (Holtz-Eakin and Gitis). Higher federal minimum wage increases the cost to employers of producing good and services. Employers consequently produce fewer goods and services, so they hire fewer workers. A federal minimum wage increase raises the cost of low-wage workers relative to other inputs that employers use to produce goods and services, such as machines, technology, and more productive higher-wage workers (Congressional Budget Office). Estimates show that raising the federal minimum wage to $12 per hour by 2020 would affect 38.3 million low-wage workers and that raising the federal minimum wage would cost 3.8 million low-wage jobs (Holtz-Eakin and Gitis). Raising the federal minimum wage to $10.10 would cause a reduction of about 500,000 workers across the labor market, as businesses shed jobs. Raising the federal minimum wage to $9.00 would cause the labor force to see a reduction of 100,000 jobs

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But would it? The Congressional Budget Office estimates that raising the minimum wage to $10.10 would boost earnings for around 16.5 million workers, while causing up to 1 million jobs to be eliminated. To me that’s not a great trade-off: according to CBO, the typical family living below the poverty line would see its annual income rise by only around $300, or about 2.8%. But for up to 1 million workers, their salaries would go to zero.

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First, one main reason that the minimum wage should be raised is because the economy will prosper. “Economic Policy Institute stated that a minimum wage increase from the current rate of $7.25 an hour to $10.10 would inject $22.1 billion net into the economy and create about 85,000 new jobs over a three-year phase-in period” (ProCon). This quote shows that the economy will flourish from the increase of the minimum wage and that unemployment will decrease. Another quote that shows how raising the minimum wage will affect employment is “To the extent that through these contour effects it affords as much as 70 percent of the workforce greater purchasing power, it effectively increases aggregate demand for goods and services, which should ultimately lead to the creation of more jobs” (Challenger 19). Bryan Covert supports raising the minimum wage by

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The current federal minimum wage is set at seven dollars and twenty-five cents. Many workers across the country are complaining that the purchasing power of the minimum wage is currently low, meaning one cannot buy as much while living off of the minimum wage. Moreover, citizens are work full time, while earning the minimum wage, are living, on average, several thousand dollars below the poverty line. However, an increase in the federal minimum wage may do more harm than good. It is likely that an immediate increase in the federal minimum wage will lead to an increase in high school drop outs, a large cut in the workforce, mass amounts of inflation, as well as a large amount of jobs being outsourced.

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Raising the minimum wage will ruin our economy. Look at the big picture, businesses and companies will struggle or close, poverty will increase, and the price of consumer goods will rise. There are a few things that let economists know how the economy is doing at the moment. They’re called economic indicators, and 2 of them are consumer confidence and unemployment rate. The more people that are unemployed, the less money being used to buy things which hurts the economy.

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Raising minimum wage in the United States would benefit over twenty eight million workers. Raising minimum wage would help businesses and would also give workers with minimum wage salaries more money then just enough to get by. The money these workers earn will go into businesses in and near their communities. Also the cost of living wages have increased throughout the years. With a minimum wage salary you have to work a forty hour work week without paying more than thirty percent of their income.

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To begin with, the federal minimum wage should be raised because it would increase jobs and economic activity. Economists from the Federal Reserve Bank of Chicago believe that raising the minimum wage to $9 an hour would increase household spending by 48 million dollars. Increasing the amount of household spending would help the economy by injecting more money in the economy. In addition raising the minimum wage to $10.10 an hour would create 85,000 more jobs for the United States. Creating new jobs would help the economy because people would have more money to spend which would increase the economy.

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Basically, a minimum wage is the lowest a company can legally pay his or her employees, You can get paid more you just can't get paid less than minimum wage. So the minimum wage was signed into the act on June 25th, 1938 by President Theodore Roosevelt. The first ever minimum wage was .25 cents an hour, Today the minimum wage is 7.25 but back then there wage compared to today would be about 4 dollars an hour. About 70 million workers are paid an average hourly wage at the age of 16 or older and of that 70 million

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America: The land of opportunity. What comes to mind when you hear “the American dream?” For most, saying “would you like fries with that?” while only being paid $7.25 per hour is probably not the first thing that comes to mind. The minimum wage was first implemented in 1938 by President Franklin Roosevelt. The purpose of putting minimum wage into effect was to stimulate the economy and keep working American citizens out of poverty.

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In 1970, the minimum wage was only $1.60, but this fit along with the price of the economy. Now, there is talk about raising the minimum wage to a whopping $15.00 an hour. While many Americans believe this to be an insane amount, others believe it is accurate and will help the United States in a way different than anything else. Raising the minimum wage amount will increase the quality of life, strengthen the economy, and change the poverty percentage. The minimum wage was established in 1938 as part of the Fair Labor Standards Act (FLSA).

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The federal minimum wage in the United States has remained unchanged for years, while failing to keep up with inflation and the rising cost of living. The Fair Minimum Wage Act of 2007 established the federal minimum wage, which gradually increased from $5.15 in 2005 to $7.25 in 2009. As of today, the wage remains the same. Many U.S. states have taken matters into their own hands and have raised their state’s minimum wage. So far, 30 states, including Washington, D.C., have minimum wages well above $7.25.

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The economic benefits of raising the minimum wage are well researched. The Economic Policy Institute found that, ”a minimum wage increase from the current rate of $7.25

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Raising the federal minimum wage to $15 an hour is the most beneficial

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Whether or not the federal minimum wage should be increased has been a controversial topic in the United States. Twenty-nine states have enacted state laws to raise their minimum wage, while twenty-one are still going by the federal minimum wage of $7.25. The federal minimum wage should be raised because it will keep up with inflation, stimulate the economy, and lift people out of poverty. A minimum wage raise would help get people out of poverty.

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The federal minimum wage established in the United States in 2017 is set at $7.25 an hour. By law this means that every employee must be paid this amount from their employer at the very least, even though states have the right to raise the wage too. This wage is set to maintain a strong economy and also for people to make money and keep their jobs. Raising the wage could have countless negative effects on the economy as well as the working class, which is the exact opposite reason for it being enacted. Raising the federal minimum wage would specifically hurt small businesses and younger workers.

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