The Positive and Negative Effects of Raising Minimum Wage

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A sensitive topic for many Americans is their income. Many people’s income relies on minimum wage. In 2012, 3.6 million people received an hourly pay at or below minimum wage. There is an ongoing debate in government as to what the minimum wage should be. Stuck at $7.25, Obama has suggested raising the minimum wage to $9.00. Depending on a person’s perspective, raising minimum wage could be positive or negative. Minimum wage has the ability to change lives, and change the economy. Small businesses and unemployment, teenage demographics, and the cost of civilian goods would be most affected.The only mystery is whether things would change for the better or for the worse. Many areas could be affected by a change in minimum wage, but potentially the most drastic change would be to unemployment. Advocates of a higher minimum wage insist that a raise would significantly decrease the unemployment rate in the United States and improve the quality of living. However, there are conflicting opinions on this. Higher minimum wage would mean higher labor costs for business owners, thus making it more difficult for employers to maintain the amount of workers they have, let alone add new employees. Raising the minimum wage does not increase the value of the worker's labor; it increases the cost of the worker's labor. As a general rule the more something costs, the less of it people will buy. This is true of not only consumer goods but also of workers in the labor market.Many jobs come from large corporations but they also come from small businesses.There are 23 million small businesses in America, accounting for 54% of sales and 55% of jobs. Raising the minimum wage means that all of these corporations and businesses will have to dig deeper in... ... middle of paper ... ...se small businesses wouldn’t be able to afford to pay as many employees. By raising the minimum wage many teenagers and others who rely on these jobs as their only source of income could potentially be put out of a job. These people would no longer be able to afford the items they want or need. Businesses would have to raise the price of consumer goods to compensate for the higher cost of employees. Businesses could potentially lose customers that have been put out of a job and are unable to afford the company’s services. Raising the minimum wage would have a domino effect on the economy leading from one negative thing to the next. Works Cited http://www.dol.gov/whd/minimumwage.htm http://www.nytimes.com/2013/02/13/us/politics/obama-pushes-for-increase-in-federal-minimum-wage.html?pagewanted=all&_r=0 http://www.salary.com/increasing-the-minimum-wage-pros-cons/

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