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History of minimum wage
Negative effects of increasing the minimum wage
Effects of raising the minimum wage
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Who are these workers that makes minimum wage? According to the official Bureau of Labor Statistics 3.3 million are making at or below the federal minimum wage of $7.25. Among 3.3 are split into two main categories. The first category is those who are making the exact federal minimum wage which accounts for 1.5 million workers. The second category is those who are making below the federal minimum wage which accounts for 1.8 million workers. The second category includes tipped workers, full time students, and disabled workers. Majority of which are tipped workers and regardless of how much tips they received, they will at least make the federal minimum wage. About 50 percent of the minimum wage earners are under the age of 25; 20 percent of which are at teenagers between the ages of 16 to 19. Of the 3.3 million workers making at or below federal minimum wage, 1.5 million of whom are employed through the food and service related industry. The other 1.8 million are employed through industries such as sales, services, transportation, building, office and more. Those 3.3 million workers earning at or below minimum wage account for 4.3% of 75.9 million total hourly paid US workers. Those who make at or below federal minimum wage, in terms of education among the total hourly paid workers: 10 percent earned less than a high school diploma, 4 percent who earned a high school diploma, and 2 percent who are college graduates. In terms of ethnicity: 5 percent are Black, 4 percent are White and/or Hispanic, and 3 percent are Asian. Majority of those making federal minimum wage resides at Idaho and Tennessee (BLS 1). A fairly common misconception is that workers, who make at or below federal minimum wage, correlate to those who would be affe... ... middle of paper ... ...ewresearch.org. Pew Research Center, 4 Dec. 2013. Web. 9 May 2014. DOL. "History of Federal Minimum Wage Rates Under the Fair Labor Standards Act, 1938 - 2009." Dol.gov. US Department of Labor, n.d. Web. 11 May 2014. Jamieson, Dave, and Saki Knafo. "One Walmart's Low Wages Could Cost Taxpayers $900,000 Per Year, House Dems Find." The Huffington Post. TheHuffingtonPost.com, 31 May 2013. Web. 11 May 2014. Reich, Michael, Ken Jacobs, and Annette Bernhardt. Berkely.edu. Institute for Research Labor and Employment [IRLE], Mar. 2014. Web. 1 May 2014. Shierholz, Heidi. "Lagging Minimum Wage Is One Reason Why Most Americans' Wages Have Fallen behind Productivity." EPI.org. Economic Policy Institute, 11 July 2013. Web. 28 May 2014. White, Matha. "Fast-Food Workers Are Costing the U.S. $7 Billion a Year in Public Aid | TIME.com." Time.com. TIME, n.d. Web. 01 May 2014.
Welfare reform caused many families surviving with the help of the government to go out and look for jobs despite their need for childcare that they could not afford. Barbara Ehrenreich, a journalist with a PhD, decided to find out how life would be like living on minimum wage labor. During her journey, we see that labor has not changed majorly because laborers are not paid fairly and they are declined their rightfully owned rights. Although women are allowed in the workplace, an eight hour work day is established, and we have a minimum wage, many are still struggling to make it because the system simply does not work unless you are running the show.
“Franklin Roosevelt’s 1937 impassioned speech calling on Congress to help the one-third of Americans who were “ill-housed, ill-clad, and ill-nourished” heralded in the Fair Labor Standards Act of 1938 and with it a national minimum wage. Echoes of that speech are still heard today. Senator Edward Kennedy (1989: S14707), in his criticism of the most recent increases in the minimum wage, declared:
In this article, James Dorn and David Cooper argue whether raising the federal minimum wage will help or hurt low-wage workers. James Dorn, Vice President of Academic Affairs at the Cato Institute, argues that raising the federal minimum wage would hurt low-wage workers by reducing job opportunities and raising prices. Dorn also states that the federal minimum wage is responsible for high unemployment among teenagers and minorities and lower productivity among low-wage workers. David Cooper, an analyst from the Economic Policy Institute, argues that the federal minimum wage is not a living wage and that raising the minimum wage doesn’t have a significant effect on employment. Cooper also states that eighty percent of low-wage workers are at least twenty years old and that eighty-five percent of small businesses already pay their employees more than the minimum
Wimmer, Bradley S. "The Minimum Wage and Productivity Differentials." Journal of Labor Research Fall 2000: 649. EBSCOhost MasterFILE Premier. 22 April 2001 .
Gitterman, Daniel P. “Remaking A Bargain: The Political Logic Of The Minimum Wage In The United States.” Poverty And Public Policy 5.1 (2013): 3-36. EconLit. Web. 24 Oct. 2013.
Washington has the nation’s highest minimum wage at $9.19 per hour. Seattle is set to raise the minimum wage even further, to $15 per hour. More than fifteen millions people work for a minimum wage, which lead to about fifteen thousand dollars a year. These workers would earn a lilt bit below the poverty line for a family of two (Blankinship). Seattle Mayor Ed Murray is pushing this effort since December of last year. Some council members, like Kshama Sawant of the Socialist Party, also support this measure. The federal minimum wage is currently set at $7.25 an hour, with President Obama’s plans to push it to $10.10 an hour (Weissman). Faster workers went on strike in many cities to demand better pay and right to unionize. $15 an hour is part of their demand when they protested in August of 2013 across fifty cities. In this current economy, people ages 25 to 54 are the largest group to hold fast food jobs. Since these jobs pay so little, these workers qualified and used $243 billion in public benefit per year (Covert). Although this is a popular policy, economists and journalists are conflicted in their analysis of the effect of increasing the minimum wage. Some economists found the minimum wage hikes lead to small j...
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.
The Fair Labor Standards Act The Fair Labor Standards Act (FLSA) was passed by Congress on June 25th, 1938. The main objective of the act was to eliminate “labor conditions detrimental to the maintenance of the minimum standards of living necessary for health, efficiency and well-being of workers,”[1] who engaged directly or indirectly in interstate commerce, including those involved in production of goods bound for such commerce. A major provision of the act established a maximum work week and minimum wage. Initially, the minimum wage was $0.25 per hour, along with a maximum workweek of 44 hours for the first year, 42 for the second year and 40 thereafter. Minimum wages of $0.25 per hour were established for the first year, $0.30 for the second year, and $0.40 over a period of the next six years.
U.S. Department of Labor. 2014. “History of Federal Minimum Wage Rates Under the Fair Labor
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,
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.
getting harder and harder as the cost of living keeps rising. While the cost of education, housing, groceries, healthcare, and utilities continuing to cost more, the American worker is scrambling to make ends meet on low wage incomes. Marco Rubio, author, politician, and attorney of law reveals, “Today the current federal minimum wage is $7.25 a hour, and has not been raised in seven years. In reality, a person working full time at a hourly wage of $7.25 will make about $14,000 a year”. Given that, the federal government deemed that the poverty line is anyone who makes less that 17,000 a year. Imagine supporting a family on those figures. Since it is apparent that the current minimum wage earner can not make enough money to support themselves, let alone a family, the minimum wage needs to be raised.
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).
Pyke, Alan. "The Minimum Wage: Myths & Facts." Media Matters for America. N.p., 15 Feb. 2013. Web. 18 May 2014.
On the 1st of April 1999, the National Minimum Wage (NMW) was introduced in the UK at a rate of £3.60 per hour for workers aged 21 and older, and at a rate of £3.00 for workers aged 18-21. Since then, it has grown steadily to reach a rate of £6.31 per hour today. The NMW is “the minimum pay per hour that almost all workers are entitled to by law” (www.gov.uk). In 1999, 1.9 million people were paid less than £3.60, sometimes even below the Living Wage due to the dismantling of unions by the Thatcher government. The idea of a minimum wage then came up, supported by the Labour Party, in order to reduce the increasing poverty and to prevent low wages workers from being exploited by their employers. The Conservative Party, supported by employers, was strongly opposed to this project, arguing that a minimum wage will damage the economy and create poverty due to higher unemployment levels. So, how does the NMW really affect poverty and employment in the UK?