Pros And Cons Of Raising Minimum Wage

When minimum wage was introduced in 1938, under the Fair Labor Standards Act, the purpose was to establish a standard wage that employers cannot decrease and to help alleviate poverty. In 1938 minimum wage was established as $0.25 an hour and as of 2009 minimum wage is established as $7.25 an hour. Although recently in the past few years many corporations have made raised their minimum wage to $9.00 and even up to $10.10. Now, much of society is pushing for an established minimum wage of $15.00 per hour by 2020. Whether or not to raise minimum wage has become a heated debate in congress as well as between businesses, individuals and even economists. Both for and against raising minimum wage have their pros and cons. While it may seem

According to the Institute for the Study of Labor found that ?a 10 percent increase in the minimum wage would result in a 4 percent increase in food prices and a 0.4 percent increase in prices overall?(ALEC 5). Many businesses, like Sally Beauty Company and El Pollo Loco, have already begun raising their prices in order to compensate for added costs. The law of demand claims when prices of goods and services increase, the demand by consumers for goods and services decrease. Due to businesses creating inflation, consumers will have to pay more for less. The effects of raising minimum wage not only eliminates jobs, but hits everyone by making consumers spend more money to attain the

Raising minimum wage could be a step toward closing the gap between rich and poor, thus eliminating income inequality. Not including inflation, but minimum wage workers could have more money in their pockets. For the economy as a whole, minimum wage workers would spend more money that would put more money into the economy. For businesses, paying employees more could make them more productive and the business to have a lower turnover rate. Businesses would not have to spend more money on training and have experienced workers. Proponents for raising minimum wages do raise plausible points that are considerable. Although there are many factors that the Proponents do not consider like: inflation, the laws of supply and demand, the cause and effect of added costs for business and more. Proponents of raising minimum wage want to alleviate poverty, but in reality raising minimum does not benefit the poor at