Introduction Minimum wage was established state wide in 1938 by Franklin Delano Roosevelt; at that time it was only 25 cents which is equivalent to 4 dollars in today’s world. It was established as part of the Fair Labor Standards Act which covered youth, government and overtime pay. Massachusetts was actually the first state before Franklin’s statewide acknowledgement, and it only covered woman and children without overtime. There are lot of issues with minimum wage now such as setting a statewide minimum wage to $10.10, which does not benefit places were living is expensive such as in New York. It leads to an imbalance in different states’ economies, and the government setting price controls in wage has some issues. A minimum wage reformation came during the 1960s and 1970s when the retail agricultural and services industries became covered under the minimum wage. By doing this the minimum wage coverage percentage changed from 20 to more than 90 percent in 1975 (Gitis, 2013). This change expanded the net of people who can benefit from the minimum wage. The income inequality during this time was at a low which made the American economy stronger than today. 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 ... ... middle of paper ... ...g on the changes of cost of living to prevent there becoming a wage floor. My argument for implementing the policy of factoring price differences from state to state when setting minimum wages is that it benefits a wide net of people. Factoring price differences from state to state when setting minimum wages can help change our economy and provide fairness in society in many ways. One way is by making minimum wage more efficient and compatible with the buying power of the state. It also takes into account each individual state 's prices and not just one nations prices on products. This gives a more in-depth view into what the minimum wage should be for each state. This policy 's impact on the economy and on justice grounds is that it gives every state and their workers, a fair chance to make a living and the ability to afford the products that come into the state.
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The shockingly low minimum wage in America is borderline unethical. Since the minimum wage was established in 1938, there’s been controversy about how much it should be. It was originally set at an amount that would allow workers to maintain a minimal standard of living (30 Days). Since then, the minimum wage has been raised 22 times, but this hasn’t been enough to support the same goal. Not only has inflation made minimum wage worth significantly less, but the cost of living has gone up. Two thirds of American citizens support raising minimum wage again (Mantel, 76), but some still oppose it, saying it would hurt jobs and the economy. Although raising the federal minimum wage would most likely cause some jobs to be lost, it should be raised because of the positive effect it would have on poverty rates, the economy, and the individuals living on it.
The minimum wage was, as it should be, a living wage, for working men and women ... who are attempting to provide for their families, feed and clothe their children, heat their homes, [and] pay their mortgages. The cost-of-living inflation adjustment since 1981 would put the minimum wage at $4.79 today, instead of the $4.25 it will reach on April 1, 1991. That is a measure of how far we have failed the test of fairness to the working poor.” (Burkhauser 1)
Currently, in the United States, the federal minimum wage has been $7.25 for the past six years; however, in 1938 when it first became a law, it was only $0.25. In the United States the federal minimum wage has been raised 22 times since 1938 by a significant amount due to changes in the economy. Minimum wage was created to help America in poverty and consumer power purchasing, but studies have shown that minimum wage increases do not reduce poverty. By increasing the minimum wage, it “will lift some families out of poverty, while other low-skilled workers may lose their jobs, which reduces their income and drops their families into poverty” (Wilson 4). When increasing minimum wage low-skilled, workers living in poor families,
A federal minimum wage was first set in 1938. The first minimum wage was just 25 cents an hour in 1938. Can you imagine surviving off of 25 cents an hour? Now just over 70 years later the federal minimum wage is now 7.25. The question at hand is the federal minimum wage enough to meet the minimum requirement for a good, happy and healthy life? Some states and cities say no. While a select few states and cities have mirrored the federal minimum wage of 7.25, some states have placed their state or city/county minimum wage marginally higher than the federal minimum wage. So why would some states prefer to have a higher level than required by the federal minimum wage when some state have decided to match or even go below the federal minimum wage level. The answer to this question lies within each state city and county and how they perceive the cost of living in the presiding area. Minimum wage needs a makeover in America despite some of the negative effects that may come along with it. This paper will explore the reasons behind federal and state minimum wages and why some of them differ among states counties and cities across America.
On Saturday, June 25, 1938, President Franklin D. Roosevelt signed 121 bills. Among these bills was a landmark law in the United States’ social and economic development—Fair Labor Standards Act of 1938 (FLSA) or otherwise known as the Wages and Hours Bill. This new law created a maximum forty-four hour workweek, guaranteed “time-and-a-half” for overtime hours in certain jobs, banned oppressive child labor, and established the nation’s first minimum wage. By definition, a minimum wage is the lowest wage permitted by law or by a special agreement (such as one with a labor union). Throughout the years, the minimum wage has been a central debate topic for the socioeconomic world and now in 2014, the debate has broken through the surface once more. In order to make a choice of whether the wage should be increased or decreased, the history of the wage is needed to make an informed decision.
According to Gabrielle Karol’s article, “How Raising the Minimum Wage Would Help the Economy”, increasing the minimum wage would cause a decrease in poverty and debt for many families. An individual who works for minimum wage roughly earns 15, 080 dollars a year. Karol insists 15,080 dollars a year barley allows individuals to provide food and shelter for their families. Karol states, “A common definition states that the living wage should be high enough that no more than 30 % of take-home pay needs to be spent on housing.” With an increase in minimum wage, families who currently have one or more members earning minimum wage would be able to afford a car, afford medical insurance, pay utilities, and provide meals for their families; raising the minimum wage would allow families to afford the essentials in life (Karol). Not only would families be able to sustain a standard living, they would be able to pay off old bills and pay off the debt they have...
According to Principles of Macroeconomics by Gregory Mankiw, “The U.S. Congress first instituted a minimum wage with the Fair Labor Standards Act of 1938” (Mankiw 4-119). Minimum wage is used to set a limit of pay employers must pay their employees. Through the years the minimum wage has raised as productivity has raised. The minimum wage has constantly fluctuated and changed multiple times.
Minimum wages go all the way back to 1938, during the great depression, when the stock market crash and bank loan were failing. Families need income of some type, were they wanted to make it fair were individual could get pay the same without a college degree. I am going to start off with a little about minimum wages history and how this could help our Economic.
Imagine a world where you are working overtime, seven days a week, yet your kids are starving. You can’t get the education you need because you don’t have the time and money to afford it, and you can’t change jobs because this is the only one you can get. Unfortunately, this is the reality for millions of Americans living today. The federal minimum wage is too low to help families, and actually mathematically speaking, too low to survive on. The quality of life for minimum wage families is terribly low, and that is unacceptable. As humans, we should be looking after others and helping the poverty come out of their continuous cycle. Raising the minimum wage would not only help families be able to afford a better quality of life, but help them to afford healthy food, get an adequate education, and invest in the necessary health care they need.
The current U.S. federal minimum wage for untipped workers is currently $7.25 an hour, as it has been since 2009. At this rate, a full time employee would earn an annual salary of $15,080, meaning that a family of two people, for example a single working mother with one child, working a full time minimum wage job, would sit below the federal poverty line of $15,730 for two people (2014 Poverty Guidelines). While it is true that there are tax breaks such as those for children, and the Earned Income Tax that exist to help such people living in poverty, the fact exists that the wages in the US have not kept up with inflation and the cost of living. While the value of the federal minimum wage has risen 21% since 1990, the cost of living itself has risen 67% (Gilson). Opponents are quick to argue that only unskilled workers are paid minimum wag...
Minimum wage was created as a price floor to protect workers from employers that wanted to provide them with low paying jobs. Cooper explains that “during periods of high unemployment many workers are forced to take lower paying jobs.... because there simply are no other options available to them.” Workers do not have any power during periods of unemployment. Employers can easily abuse their power and they will. Businesses try to make the most amount of money possible, meaning they will pay their workers little to nothing to increase their profit. Thus, the idea of Minimum wage contradicts itself because it is the reason for the high unemployment rate in America. Consequently, forcing workers to take low paying jobs because the supply of jobs is so
Today the federal minimum wage is $5.15, but should be about $8.50 if Congress had adjusted it for inflation over the past 35 years. While $5.15 may not seen that bad, when factoring in such variables as sky rocketing gas prices, budgets can get pretty tight. David Shepard, a sophomore at Wayne State University, worked at a Meijer Retail and Grocery Superstore for over two years while in high school. At the time Shepard lived with his parents and didn’t have to worry about paying rent or buying groceries, all that he had to pay for was filling up his gas tank and paying for his car insurance. Shepard recalled, “It was all I could do to pay for the basics like gas and bill’s, I barely had any money to have fun on the weekends”. This is only an example of a high school student that can nearly slip by on minimum wage with only a few expenses. There are 1.8 million people in America with children under the age of 18 that would benefit from an increase in minimum wage (Minimum).
The minimum wage being too low has been a public issue in America for generations. Basically, the debate includes two different opinions. Firstly, people who want to raise the minimum wage, and second, people who would rather is stay the same. The overwhelming majority of liberals are on the side that favors a raise. Additionally, a somewhat smaller proportion of conservatives favor the change as well, but for different reasons. The liberal opinion on raising the minimum wage is based on the idea that putting more money in the people’s pockets, will stimulate the economy, and decrease poverty. The problem that conservatives and liberals alike have with this, is that a few direct consequences are proven to apply when raising wages. Some proposed consequences include unemployment, inflation, and unfairness to higher educated people. Another main point is that raising the minimum wage is thought to helps small business by increasing worker satisfaction. This issue of minimum wage has become increasingly popular and important in current times, as president Obama has proposed the idea of raising the minimum wage of contract workers to 10.10$ per hour (about a 30% increase from the current 7.25$ per hour minimum wage). A large number of people consider this wage hike unnecessary due to the fact that today’s value of minimum is higher than it has ever been since the 80’s, and because the wage hike comes at too high of a cost. All things considered, the issue of raising minimum wage is not a battle of political parties and their agendas, its really a debate between everyone.
Contrary to popular belief, most minimum wage workers are 30 or above with families to support, not entry level teenagers as some politicians believe. The American dream isn’t functioning when the middle class is shrinking, instead of growing (Prince). “If one works 40 hours a week, every week at 7.25 an hour that means an annual income of $15,080, with no sick days and no time off…. That’s $15,080 a year, or $13,926 after FICA deductions. Imagine paying market rates for rent in the D.C area, where a tiny apartment might take up two- thirds of the income, and require an hour or longer commute to get into the city, with subway costs taking up an additional 10% or more.”(Ornstein). The statistics show how the low wage workers live. With the added prices, like tax deductions and rent and transportation costs, there is not much money left for food and water, not to mention child care as the employees are working on average 40 hours a week. The low wage workers not only struggle to support themselves, but to support their families as well. In low wage families with single parents life always seems to be a struggle for survival and juggling the costs of necessities vs the meager paycheck the employees bring
A minimum wage is an hourly wage that is established by the government which represents the minimum amount an individual receives per hour. The federal minimum wage was established in 1938 under the “Presidency of Franklin Roosevelt” (Henderson). Currently, majority of the states have their minimum wage less than $10. However, the federal government wants to increase the minimum wage to $12 across the United States. The federal government believes that increasing the minimum wage will assist numerous people in the United States as most individuals are working in a minimum wage job to support their families. 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 of this nation are working a minimum wage job. Numerous people believe that these workers are not able to make their 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 for the society.