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Raising Minimum Wage Essay

840 Words4 Pages

Currently in the United States, there is a strong effort by workers of the fast food industry as well as some of retail companies to raise the federal minimum wage to $15 per hour. The current minimum wage is $7.25 an hour, which turns out to be about $15,080 per year. This is said by many to be an unlivable salary and leaves minimum wage employees in poverty. However, by raising the federal minimum wage there is a greater potential to hurt the small businesses of this country or possibly leave them with no choice but to close their doors. Surely, that would lead to higher unemployment and an unstable economy. The federal minimum wage of the United States should not be increased because it would hurt small businesses, the American people, and …show more content…

Small companies rely on minimum wage workers to allow the business to function. In most cases, these companies do not have extra money to be able to pay out higher wages. A minimum wage increase would make it very difficult to hire new employees and may also result in positions being cut (Smith10). Many small business owners have shared their negative thoughts and reactions to a minimum wage increase. Jane McGinn, owner of a startup, described herself likely going out of business if the wage increase took place. Furthermore, a dog walking company is already charging the maximum of what clients are willing to pay. For many owners, if there was to be a wage increase, the company would have to raise their prices of services and would surely lose clients. Also, a coffee shop owner stated with a minimum wage increase her cost of labor would be 45% of her business. “Honestly, I’d go under with that kind of increase.” (qtd. in Wang). The minimum wage increase would raise a worker’s pay by $6,000 a year (Smith 11). If a company has five employees, they would have to make an additional $30,000 just to break even with the previous year. That is huge task to overcome for a small business. A federal minimum wage increase would have a very negative effect on the small businesses of this

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