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Minimum Wage Debate

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The idea of a federal minimum wage was introduced by President Franklin Roosevelt during the Great Depression and was initially set at $0.25 an hour which today would be equivalent to about $4. Since then Congress has increased it 22 times, the most recent one being in 2009 from $6.55 to $7.25 an hour. Each state also is able to higher their minimum wage or price floor to correspond to their cost of living, one of the 29 states that have is California (ProCon). Currently the main debate is to whether or not to raise the federal minimum wage and how it will affect the labor market. Everyone wants to make sure that people working full-time, even at minimum wage, are still able to provide for their families. This decision will affect many aspects …show more content…

In any case, changes in minimum wage at a state level seems like a better way to get the economy to reach its ideal growth. The impact of minimum wage on a labor market is debatable for those on either the left or right of this issue. Those on the left say that a minimum wage is set so that it helps the labor market by reducing employers’ excessive market power, meaning they would not be able to pay unfairly low nor have immobile workers. Those on the right say that labor markets are competitive and a set wage will negatively impact by reducing employment especially those who are unskilled. Either way, a difference in various factors such as a having competitive market or not will change the ultimate result which lead to many economic theories (Tasci). There are many results when increasing the minimum wage, again each depending on various theories and studies. For example, on the left if the wage is …show more content…

I agree with legislatures saying, “low-wage workers need a pay hike from the current $10 hourly minimum to stay out of poverty and keep up with California’s high cost of living” (Calefati). As higher wages are implemented we may see an increase in purchasing power that will hopefully in turn create demand. This could help in balancing the inflation rate as well. Based on the Mercury News article, The President of the California Chamber of Commerce other Assemblywomen agree with my only criticism, that the jump to $15 in 2020 seems too rapid and laws should accommodate the rise of real wage along the way so that we don’t hurt our economy. Minimum wage jobs still belong in California as long as they are adjusted with the local inflation. At the federal level minimum wage should see a slight increase to correspond to inflation like the real value or opt referencing it to a state with a low living wage for basics. If we do not raise minimum wage we do not know if it the economy will regulate itself to keep the gap of wage inequality from growing. Before policymakers consider raising minimum wage they should see where else they can see improvements such as a decrease in government welfare spending. The Center for American Progress reported in 2014 that raising the federal minimum wage by 6% to $10.10

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1094 Words | 5 Pages

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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Raising the minimum wage isn 't entirely beneficial. It could potentially lead to more unemployment as some businesses may reduce their number of employees or reduce their hours in order to offset the cost of paying a higher minimum wage. Some may also increase the prices of products or services offered. It can also possibly lead to a decreased interest in college education since minimum wage jobs are paid almost the same or can be more than what jobs requiring college education pay.

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733 Words | 3 Pages

The federal minimum wage should be increased because raising it would increase the economic activity and spur job growth, decrease poverty, and also improvements in productivity and economic growth have outpaced increases in the minimum wage. Increases in job growth and economic activity will happen when the minimum wage is elevated. If the minimum wage was increased it will “inject 22.1 billion net into the economy and create about 85,000 new jobs over a three year period”. (“Raising the Federal minimum Wage to $10.10 Would Lift Wages for Millions and Provide a Modest Economic Boost") Thousands of new jobs will be created and it will put billions of dollars into the economy.

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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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Some disagree with this and say increasing the minimum wage costs more for the employer and cuts jobs, increases inflation rates, and some even say these employees do not deserve to be paid more. However, minimum should not increase nor stay the same, it should decrease, by doing so would decrease employer costs allowing for more jobs, help reduce prices on goods, and will encourage employees to become more experienced and skillful to increase wage. With the current minimum wage small companies can only hire so many employees before they can no longer afford any more help. If minimum wage was to be decreased then the employee expenses companies pay would decrease.

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I agree that the United States federal minimum wage should be increased to reduce labor turnover, increase consumer activity, and decrease poverty and crime rates. Increasing the federal minimum wage would increase consumer goods activities due to increased pay. According to the U.S. Bank, at

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. . The current value of the minimum wage in real dollars is at its lowest level since February 1956, when the lowest U.S. wage was 75 cents — the equivalent of $7.19 in June 2022 dollars” (Cerullo). The increase in the federal minimum wage and adjusting the price to compare with inflation would ensure that low-wage workers could adopt a standard of living that is equivalent to the current economy. The federal minimum wage should also be increased as it will allow minimum wage workers to afford basic living expenses. Currently, the minimum wage is not enough for people to afford housing and other necessities.

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519 Words | 3 Pages

In turn, this will lower the amount of jobs available. In areas with higher living costs, a higher minimum wage can make sense (Johnson, 2016). However, in lower class areas, the potential for consequence is higher. However, it is still not extremely likely. If someone has a job, they are more likely to keep and benefit at the same time because of the increased wages.

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1711 Words | 7 Pages

The topic of minimum wage has been debated for many years. Merriam-Webster defines minimum wage as "a wage fixed by legal authority or by contract as the least that may be paid either to employed persons generally or to a particular category of employed persons. " people are usually either for or against the raise of minimum wage, with their own beliefs at the core of why they want to raise it or keep it the same. Some advocates for the raise in minimum wage to a living wage say that it will be beneficial to all the citizens of the united states, while others say that if we do raise it to a living wage it will collapse our economy.while we do see evidence for both sides we have to decide what is the best for the betterment of the american people.

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At the same time, I support that each state can and should also set its state minimum wages. I will go even further and would say that each city should be able to set its minimum wage. We can analyse the economy, the minimum wage and the employment as a whole in the entire country but each market, state and city are very different when we compare the size of the population, its local economy, GDP, developed market and competition. Big cities like New York, San Francisco and Los Angeles (to name a few) have much higher living cost. The rent, housing, gas, food and everything else is more expensive compared to cities like Fort Wayne, Indiana or Des Moines, Iowa.

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Since the Great Depression, there has been a minimum wage in America, but this minimum wage has changed 22 times since the Great Deprnbession. Many people say minimum wage should stay at $7.25 like it has been since 2009. Meanwhile, other people believe that minimum wage should be $15.00 so they can have more money to live comfortably. People think that a higher minimum wage will help, but it will hurt more people than it will help. If America makes the minimum wage $9.00, people will no longer be in poverty and it will make the economy balance out.

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Minimum wage has been a very important topic in politics, especially raising minimum wage. Many politicians talk about how raising minimum wage can be detrimental but only view raising minimum wage from a political viewpoint, often forgoing the economical benefits of a higher minimum wage. As the economy has grown since the last economic recession in 2008, the minimum wage should have increased along with it. Instead because of political issues between people against and for raising minimum wage, the minimum wage has stayed the same in most parts of the United States or has only gone up slightly. A raise in minimum wage is beneficial to the economy and is necessary for the economy to continue to grow.

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Even though some may say that one cannot live off the current minimum wage, the government should not raise the federal minimum wage. In 1938 the first federal minimum wage was introduced by Franklin D. Roosevelt and started at 25 cents and hour, equivalent to 4 dollars now. Throughout the years the minimum wage has only risen, but has fluctuated in worth. As of the year 1980 the federal minimum wage has stayed below of an equivalent 8.80 2012 dollars. More recently, since 2000 the minimum wage has held an average of 6.85 dollars.

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607 Words | 3 Pages

There are a lot of potential benefits for an increase in minimum wage and on the surface it’s hard to see why you wouldn’t want to increase the wage. One of the clearest to see is that an increase to the minimum wage will also increase the spending for each household during the following years. So it works to help stimulate the economy in whatever area you increase the minimum wage. Along those same lines increasing the minimum wage will lead to a decrease in poverty as well. With the decrease in poverty you will also see a decrease in government spending on welfare items because the individuals receiving the higher wage in theory will be able to pay for these services/welfare items without assistance.

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In the past three years, many politicians and labor unions have been pushing for an increase in minimum wage. Minimum wage is the lowest set wage by a law of a government body. An increase in minimum will benefit some people, and hurt others. An increase in minimum wage will cause benefit in the short run but will be very damaging to the economy in the long run. There should not be an increase in minimum wage because it is unhealthy to the economy in the long run and it will be the major cause of job loss, increase in inflation, competition, and the price level of goods and services.

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