The Pros And Cons Of Minimum Wage

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Whether they care about the economy, or only care about their own wage, everyone has an opinion regarding raising or keeping the federal minimum wage at $7.25. Why do we have a minimum wage? Some people say “It is impossible to live on minimum wage! It should be raised!” Minimum wage is not meant to live on for the rest of one’s life. In modern days, it exists to help high school and college students, or people who had economic issues and need to get back on their feet. First, let us examine the “cons” of raising the federal minimum wage, starting with a quote from the business-backed nonprofit Employment Policies Institute. “Multiple studies have demonstrated little to no relationship between a higher minimum wage and reductions in poverty.” A well-known theory concerning…show more content…
Common words of the supporters of increasing the minimum wage are “It will help those in poverty.” If an employee worked 40-hour weeks, he/she will earn approximately $15,080 per year, slightly below the federal poverty threshold of $15,130. However, it is imperative to consider that most employees earning minimum wage work less than 40 hours per week. Therefore, more cha-ching is good! Right? It is important to know that state minimum wage laws may differ from federal minimum wage laws. The law with the highest dollar amount should be used for payroll. For example, if the federal minimum wage is $7.25 per hour but state X has a minimum wage of $10.00, the employee is entitled to the higher minimum wage. Timeline of federal minimum wage amendments under the Fair Labor Standards Act (establishes minimum wage, overtime pay, record-keeping, and youth employment standards) 1949 —

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