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Effects of rising minimum wage
Positive effects of increasing the minimum wage
Positive effects of increasing the minimum wage
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Unlike the purpose of a higher minimum wage, a raise in minimum wage would bulldoze a plethora of people more into poverty. A minimum wage raise would have a cause and effect situation, it would cause a layoff in people’s jobs and effect where people were now receiving their checks. With a higher minimum wage, it would cause employers to employ less because they could not pay as many people that high of pay. In a study, there would be a 9% employment loss for a person between the ages of 25-61 with a 10% increase in the minimal pay (Jenkins). The target for raising the minimum wage is those adults who are living off the mandatory pay. But, as Jenkins found, it does the complete opposite. It would cause more people to lose their jobs and
Poverty continues to grow in America. The average minimum wage in the United States is $7.35 an hour- far too low in today’s society. Key expenses, for example, gas and housing prices, have gone up significantly since the minimum wage was last changed in 2007 (Wagner 52). The laws creating the minimum wage were intended to improve the standard of living and decrease poverty. Raising minimum wage is a vital step in decreasing poverty and giving every family the opportunity to survive and succeed. Millions of hard-working Americans are below the poverty line and need an increase in pay. Minimum wage must be raised because it will diminish poverty and assist the working class to support their families.
Understanding the basic concept of minimum wage is important for every single individual. We all live in this world together and it is obvious that there is an order. In order to continue our lives and afford our basic needs, we all need to work and gain wealth. As the old adage says ‘‘There ain’t a such a thing as a free lunch.’’ We need to give up on something that we like to get something else that we like. That’s why, every single individual in the society face trade-offs. However, people have different status. Some people work as employees and some work as employers. In that case of minimum wage the trade off is between employees and employers. Employees work for employers in order to gain money and afford their minimal living expenses whereas employers give up on their money and pay for employees because employers take care of their need of labor. Employers pay for their workers who we call employees and employees gain hourly money. The calculated minimum money that they gain in an hour base called minimum wages. Besides, there is this cycle that everyone actually works
The minimum wage today has a lot of issues; some people say it is not enough to live comfortably. Many agree that there needs to be an increase in minimum wages and by doing that it can help with our issues of poverty. Statistics show that a worker who is full time and earning minimum wage makes only $15,080 a year, which is under the federal poverty line for a family of two. (Gitis, 2013) The problem with that is $15,080 is not a sufficient amount that a person can live and grow on. “A family of two can consist of a mother and son or daughter, father and son or ...
One way raising minimum wage will be beneficial is that it could lift many Americans out of poverty. Raising the minimum wage in Illinois, would help the families of more than 1.1 million workers who work to meet their children’s basic needs and “reduce the adverse effects of poverty on a child’s well-being” (Fiscal Policy Center). Studies have shown that raising the minimum wage would help 1 in 5 Illinois families who are in poverty. By raising the minimum wage in Illinois, it would help workers with families spend money on food, housing, gas, and other needs without going into poverty. Along with puling Americans out of poverty, raising the minimum wage could also stimulate economic growth. Raising the minimum wage, is stimulating economic growth by worsening the income inequality and substantially reducing the employee turnover for the business. Increasing a person’s income would raise their yearly earnings by $3,640 and “Improve the economic security and reduce the economies poverty rate” (Fiscal Policy Center). Low-wage workers spend most of what they earn on their basic needs, which is quickly spent and does not leave the worker with much money left to spend on other needs. This boost in the minimum wage will stimulate the economy and help create opportunities for more people, by hiring more workers to keep up with the
Minimum wage is the lowest remuneration that can be paid to workers by employers. Although minimum wage laws are in effect in many jurisdiction, differences of opinion exist about about the benefits and drawbacks of minimum wage . Supporters of the minimum wage say it increases the standard of living of workers.The federal government established a minimum wage in a 1938 law called the Labor Standards Act, which also marked the first time that employers were legally required to pay workers overtime for certain jobs. At the time the law passed the country’s first minimum wage twas (0.25).
· According to the Pew Research Center, persons in the 16- to 24-year-group make up 50.4% of minimum wage earners, despite representing only 13.7% of the workforce as a whole. Raising the minimum wage would disadvantage low-skilled workers. · From an employer’s perspective, people with the lowest skill levels cannot justify higher wages. Increasing the minimum wage reduces the likelihood of upward
Raising minimum wage will provide safety and basic needs for minimum wage workers, and it will actually help the economy. Low incomes plague many homes of America. It can cause a family of four to live in a small one bedroom apartment, along with living in poverty. Raising the wage will put millions of workers into a safer, more secure situation. On average, a minimum wage worker makes $14,500 a year, or $7.25 an hour (Raise the Wage.)
Many will argue a higher minimum wage is not necessary to improve America’s economy and are concerned about the high unemployment rate, but all in all both sides agree poverty is a significant issue. A higher minimum wage is a necessary factor to help reduce poverty in America. There are many principal motives of raising the minimum wage to help reduce poverty. One major benefit of a higher minimum wage is that it will help individuals become stable. Specifically, according to data from 2006, “the increase would mean an additional $4,200 in annual earnings for a full-time, minimum-wage worker” (Furman, Jason, and Parrot).
There are many people fighting for the federal minimum wage to be raised from $7.25 to $15.00 and hour. In fact, California voted to have their minimum wage up to $15.00. But many other states are still trying to have a law passed to raise the minimum wage. But for some states the raise would not help the economy, but instead hurt it. A higher minimum wage would help in those states with a higher price of living. In those states that have a lower price of living, the raise would make the unemployment go up because the companies would need to make cuts so they still
One reason Raising the minimum wage is a bad thing is because it leads to lower unemployment for vulnerable low skilled workers. new academic study, University of Waterloo finds 10 percent increase in the minimum wage leads up to 4 percent drop in teen employment.which in short terms is people without education dont have incentive to get a education because they are getting 15$ dollars an hour without education.. 20 canadian studies published in academic journals dating back to 1979 produced a clear consensus minimum wage hikes reduces employment.Just as consumers tend to buy less if the price of a product increases, employers will hire fewer workers and/or reduce labour costs if government regulations make it more expensive to employ workers without corresponding improvements to
As stated in the introduction the question in which this data presented in the literature review is answering is what are the economic effects of raising the minimum wage on American citizens. Through researching by a content analysis method I was able to investigate detrimental aspects to the American economy if the minimum wage is increased. Multiple plans of action have been proposed that focused on the minimum wage being increased. The aspects evaluated in this paper that would be affected vastly by an altering include high school completion, the current work force, and effect on teenage employment.
Increasing the minimum wage has always been a very controversial topic because many people are unsure of how it will effect society. One of the main concerns is its effect on jobs. According to most economists there is no “free lunch” meaning something has to be done to pay for the cost of increasing wages (Wilson). Most companies will not just take the hit and accept reduced profits. Instead companies will find other ways to makeup for their loss like decreasing the amount of employees. With information limited to two opposing opinionated articles, a novice can conjecture increasing minimum wage does not significantly decrease the amount of jobs.
People think that raising the minimum wage can benefit people who have low-income. Well, known business and corporations do not want the minimum wage to increase, as of a result they will have to pay their employees more and corporate will lose money from paying their employees more. According to “Issue: Minimum Wage” (Marcia Clemmitt) “Business owners in some labor-intensive, low-wage industries face serious uncertainties when minimum wages rise.” Also, companies would rather pay a teenager and not an adult because adults would complain about being paid minimum wage. Adults make a living off of what they earn teenagers have a job so they can have extra money when they go out. If minimum wage increases that means that everything will be more expensive since their income is rising. It will not help the poor either because since everything will be more expensive than they will not benefit from raising the minimum wage. Not only would be companies hire teenagers and not adults, but also would rather hire women than men. Pay gap also plays a role in raising the minimum wage, considering that women get paid less than
In this study, we try to observe the effects of minimum wage increase on employment and check if it agree with the demand and supply model. To do so, we first ask this question, “What is the effects of a minimum wage increase on employment?”
About “75.3 million people ages sixteen and over worked for hourly wages in 2008, according to the U.S. Department of Labor’s Bureau of Labor Statistics” (“Minimum Wage”). Meaning almost a quarter of the workforce in this nation are working a minimum wage job. Numerous people believe that these workers are not able to make ends meet, and increasing the minimum wage will help these individuals substantially. Even though people believe that increasing the minimum wage will benefit the society, they tend to overlook the drawbacks of increasing the minimum wage, and how it will prove to be detrimental to the society. People believe that increasing the minimum wage will reduce poverty and improve the living standards of the individuals.