A Brief Note On The Federal Minimum Wage

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History Of minimum wage The federal minimum wage originated in the Fair Labor Standards Act, signed by President Franklin Roosevelt in 1983. The law established a minimum wage of 25 cents per hour for all employees who produced products shipped in interstate. They were not to exceed forty-four hours of work each week. One full week’s pay would equal up to eleven dollars (Grossman) Why should minimum wage be increased? “The poverty rate is a key economic indicator often used by policy makers to evaluate current economic conditions within communities and to make comparison between sectors of the population. It measures the percentage of people whose income fell below the poverty threshold ($15,130 per year). Federal and state governments use poverty estimates to allocate funds to local communities. Local communities often use these estimates to identify the number of individuals or families eligible for various programs (Fontenot, 2014).” In 2013 about 15.8 percent of the U.S. population made wages below the poverty threshold. “This was the second consecutive year without a statistically significant change in the poverty rate. From 2009-2012, the poverty rate increased each year (Fontenot, 2014).” “In 2013, the percentage of people in the United States with income below 125 percent of their poverty threshold was 20.6 percent. The proportion of people with an –income-to-poverty ratio less than 50 percent was 7.0 percent (Fontenot, 2014).” As the United States begins to recover from some traumatic economical events, President Obama presents Americans and policy makers with a proposal to increase the minimum wage of $7.25 per hour, to $10.10 per hour to help Americas less fortunate. Despite good intentions, this could only go one of tw... ... middle of paper ... ...er for a company, instead of increasing the minimum wage and making it harder on the middleman, I think the government should develop training and educational programs for people with little to no job experience. One belief is that if the minimum wage is increased, employees won’t have incentive to leave these jobs for better opportunities that pay higher wages. By offering minimum wage workers training, they increase the employee’s skill, which makes them more of a valuable asset to their current employer, as well as other employers in their job market. Educational programs will offer workers higher levels of education, which reduces the incidence of living in poverty. Individuals who complete more years of education usually have greater access to higher paying jobs such as management, professional, and related occupations than those with fewer years of education.

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