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Minimum Wage Effects

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The Effects of the Minimum Wage
Employment
One of the most raised issues in regards to the minimum wage is the effect it has on employment. Does the minimum wage help or harm employees? Does the minimum wage create jobs or does it create a higher job competition? In what ways is the job market effected by the minimum wage? Since 1977, the Minimum Wage Study Commission has studied the effects on the employment the minimum wage has. Various studies were then conducted in the 1990s after state minimum wages and the federal minimum wages rose. However, this research used earlier studies and added new, improved methods of examining data as well as new time-series data. This was due to the differences between the state minimum wage and federal …show more content…

For example, the neoclassical model, simply put, states that the high cost of labor will decrease the demand for labor. This model assumes that each worker receives the minimum wage which is not completely inaccurate but the assumption can yield imprecise results. Another model is the monopsony model in which the employer’s side is compared to a labor force in which all employees are paid the same. This model can lead to an increase in employment as well as a decline in employment depending on the wage set by the labor force.
According to recent studies by the Congressional Budget Office, a higher minimum wage can have two effects on the employment of low-wage workers: most of the low-wage workers who would receive a higher wage due to the federal minimum wage would also have a high income with some earning an income that would put the above the federal poverty standard while another effect is that some low-wage jobs would disappear and the income of the unemployed would decline …show more content…

Employers may choose to lower the number of staff in order to still provide these benefits for employees, which would increase unemployment, or disband these programs yet keep their original number of employees. If these programs are disbanded, then the employees may have to look elsewhere for health care and this adds an added expense to their monthly salary. In this case, the higher minimum wage does not benefit but can rather harm employees as, often times, private health insurance is a much greater expense than the health insurance companies provide. Employers may also cut hours in order to still pay employees at the higher minimum wage but still not provide these benefits seeing as Federal Law does not require part-time employees to be provided health insurance or other benefits by their employers. This puts added strain on employees because, while earning more, they would be working less and would still need to purchase health insurance and other

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He accomplishes this by offering a logos approach for his reasoning. The author gives statistics proving the history of the increasing minimum wage, how it has shown to hurt businesses, and how it also has hurt employees. Then, he explains the given information and uses it to build up to his claim. After evaluating the numerical evidence and explaining the evidence, he restates his claim, which is that a “[h]igher minimum wages come at the cost of higher unemployment for low-skilled workers” (Sherk). The purpose of Sherk using deductive logic is to convince the reader that a rising wage will not help businesses or

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A person working full time at the federal minimum wage of $7.25 per hour earns $15,080 in a year, which is 20% higher than the 2015 federal poverty level of $12,331 for a one-person household under 65 years of age, but 8% below the 2015 federal poverty level of $16,337 for a single-parent family with a child under 18 years of age (procon.org pro#2). If you put the minimum wage at $9.00, people will be able to live comfortably without unemployment rates going up. However, raising the minimum wage

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