Many Americans believe that money is everything. While this may not be entirely true, a lot of people could lose a lot of what their lifestyle consists of if they no longer have a source of income. The minimum wage was installed to provide aid to workers in such a predicament. The current minimum wage was set in 2009 at $7.25 an hour, and workers are beginning to wonder when it will go up again. While many would argue that a higher minimum wage would stimulate the economy, an increase in both federal and state minimum wages would cause an increase in unemployment and inflation while failing to reduce poverty levels.
The federal minimum wage was introduced in 1938 under the Fair Labor Standards act. At the time, 25 cents an hour was, by law, the wage floor (adjusted for inflation, this is approximately $3.45). With every increase in the minimum wage, someone always pays for it; the pay difference is not made up of imaginary money. Not everyone is worth the same on the productivity scale, so those who fell short of a productivity level parallel to the new minimum wage had significantly more trouble finding employment (Wilson 6). Minimum wage and unemployment have been two of the most commonly associated topics in modern economics. In fact, an assessment done by the U.S. Department of Labor on the first minimum wage showed a loss of employment for 30-50,000 workers as a result of the established minimum wage. The correlation between the two subjects is obvious. Many insist that there is not a correlation at all, and others would argue that the correlation is only evident in the early years of minimum wages. Economists David Neumark and William Wascher reviewed over one hundred mini...
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... workers rather than the families they are attempting to support. David Neumark, a professor of economics and director of the Center for Economics and Public Policy at the University of California, Irvine, said that “other policies that directly address low family income, such as the earned income tax credit, are more effective at reducing poverty” (Cox). Wages are not the only aspect of the fight against poverty.
As much as I would love to make more money, I understand that it would have negative effects on many other American citizens. Some would lose their jobs, others would fall under the poverty line, and I would pay more for many products sold in the country. Besides, I already make 25 cents more than the minimum wage, meaning I would only benefit from an increase of more than 25 cents; that, and I won’t be working an unskilled job for long (if all goes well).
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