Analysis: Raising Minimum Wage To Reduce Poverty

Raising Minimum Wage to Prevent Poverty According to the Fair Labor Standards Act, (revised July 2013), employers are not required to pay “tipped employees,” such as restaurant servers, bellhops, counter personnel (who serve customers), bussers, and service bartenders, more than $2.13 an hour in direct wages. However, if the sum of tips plus $2.13 an hour falls below minimum wage, or $5.15 an hour, the employer is required to make up the difference. (WHD). Minimum wage jobs are not meant for people to rely on as a permanent career. These jobs will not provide for living a good quality life. They offer experience to help find a job worth living on while also helping to offer temporary financial support. Minimum wage jobs seem to offer

While this sounds like a random factor, confidence in the economy has a ripple effect and stimulates spending, lowers interest rates by making it easier for people to access loans and receive credit, boosts performance and returns in the financial market and encourages investments. There are no easy solutions, but there are remedies that have as their goal, honoring the dignity of labor—no matter who is doing the work. (Thompson 290).

Presented at the State of the Union address, in 2015, President Barack Obama states, “Of course, nothing helps families make ends meet like higher wages…and to everyone in this Congress who still refuses to raise the minimum wage, I say this: If you truly believe you could work full-time and support a family on less than $15,000 a year, go try it. If not, vote to give millions of the hardest-working people in America a raise.” (Obama, Barack. President of the United States of America). The Obama administration has expressed support in the increase of the minimum wage through the Raise the Wage Act. This act endorses that minimum wage will be at $12.00 an hour by the year 2020. The hope is that this will increase the earnings of millions of workers nationwide to support their local economy, in which they live, work and spend their income. Poor families with minimal education are especially

If the costs to fill these positions become too high, consolidation can occur and businesses are likely to replace two or three employees with one employee who excels and can do multiple jobs quicker. That is to say, it would probably be more efficient to hire an ambitious and talented self-started at a higher wage an hour to replace two or three less ambitious or inefficient employees at a lesser wage. Businesses could pay the one employee over-time and still be ahead in the end. The more an employee is paid, the more is expected of them. A retail business may employ the highest percentage of minimum paid employees with some of these being high school students that work at fast food restaurants, movie theaters or deliver pizzas. A small business is at a disadvantage as they typically have a higher overhead cost and the need to make more on products sold just to stay open. Raising minimum wage would only make it more difficult for them to succeed and would force them to raise the price of goods and services. If higher labor costs cause the price of goods and services to go up this in turn weakens the power of the dollar and progress will not made. The American economy needs economic growth that enables people to succeed, not a temporary fix with a new minimum wage which will increase demand. In the like manner, higher paid employees would want raises to equal those of the minimum wage employees. If