Minimum Wage : Labor Standards Act Essay

Minimum Wage : Labor Standards Act Essay

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The minimum wage established 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, the minimum wage was set as $0.25 an hour and as of 2009 the minimum wage is $7.25 an hour. Although recently in the past few years, many corporations have raised their minimum wage to $9.00 and even up to $10.10 an hour. Now, much of society is pushing for an established minimum wage of $15.00 an hour by 2020. Whether or not to raise the minimum wage has become a heated debate in Congress as well as between businesses, individuals, and even economists. Both for and against increasing minimum wage have their pros and cons. While it may seem that in the short run raising the minimum wage helps the poor, the long run effects of raising the minimum wage are; depressing the economy, pushing businesses to a breaking point and increasing costs to individuals.

Raising minimum wage looks promising in the short run, but the economy is weaker and harsher to small businesses, large corporations and individuals in the long run. People that are for raising the minimum wage recognize it as an opportunity for the poor to obtain a better standard of living with their higher salaries. Although the results of studies have concluded that raising the minimum wage weakens the economy as a whole. The Heritage Foundation found that if Congress were to raise the minimum wage to $10.10 an hour nearly ?an estimated 300,000 jobs per year? eliminated as well as ?lower[ing] the national gross domestic product by an average of $40 billion per year?(ALEC 4). If the minimum wage rose up to $15 per hour by 2020, it ?would cost 6.6 million jobs? (Holtz-Eakin ...


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...le. 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 all.
Minimum wage is a way for lower-skilled and inexperienced workers to attain an income. However, to increase the minimum wage will weaken the economy, businesses, and individuals. Unemployment and prices will increase. Businesses expansion, consumer spending, and job experience will decrease. GDP and money flow will decrease that ultimately shrinks the economy. Raising minimum wage short run promises do not compensate for the long run results hurting everyone from the cashier at McDonald?s to Large Corporations and even the US economic system in the end.

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Minimum Wage : Labor Standards Act Essay

- The minimum wage established 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, the minimum wage was set as $0.25 an hour and as of 2009 the minimum wage is $7.25 an hour. Although recently in the past few years, many corporations have raised their minimum wage to $9.00 and even up to $10.10 an hour. Now, much of society is pushing for an established minimum wage of $15.00 an hour by 2020....   [tags: Employment, Minimum wage, Wage, Wage labour]

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