Macroeconomics Minimum Wage

1393 Words 6 Pages
Minimum wage is broken into two different wages, One is from the federal standpoint and the second is from the State 's standpoint. Federal minimum wage is set so that no state is allowed to go under the given minimum wage. State’s minimum wage is when the State agrees to make the minimum wage higher than the given federal wage. Personal experience has to lead me to think minimum wage should be a starting wage and it should not be expected to support a person or a family. I started working when I was sixteen years old, I wanted to work because I wanted to buy clothes for myself and other things that interested me. A couple years after taking a part-time job with minimum wage I saved money to buy the things I wanted, such as, buying my car and …show more content…
Many macroeconomics do not know what will happen to the economy when wages are raised, but they do know that food price will rise to account for the cost of direct labor. Owners must account the expenses of paying the workers in their new wages. This is lead to the increase of the price of a store 's product such example, as McDonald 's prices will rise of their big macs and etc. According to the article “Why raising the minimum wage in Seattle did little to help workers, according to a new study,” written by Max Ehrenfreund, talks about the situation in Seattle of their minimum wage increase. He states that the most recent increase of wage did not really help the workers and the difference is not that big. Ehrenfreund shows statistics that workers only increase of a measly five dollars and fifty-four cents. When further researcher was made on weekly earnings and made a conclusion that weekly earnings decreased by five dollars and twenty-two cents. In conclusion that workers are not benefiting from the increase pay …show more content…
Obama did a good job in trying to create jobs and cut the unemployment rate after the Bush administration. When wages increase, the business needs to account for direct labor expenses and they need to change the price of the product if they are producing one. Although none of the researchers can come to the conclusion if raising the minimum wage will cut jobs. Zwolinski talks about how the economist cannot pin if unemployment will go up or down. One thing for sure is that as technology increase the possibility of outsourcing to technology. A possibility of business using more machines to replace workers to cut the expenses of paying the workers. The most recent year business is investing in machines to cut expenses. They are slowly trying to invent more robotics to help with the assembly line and even McDonald’s are trying to find a way to cut workers and have the technology to take orders for customers. According to an article "Should We Raise the Minimum Wage? 11 Questions and Answers,” written by Jordan Weissmann, he states that half of the economist are on the traditional side which sides that minimum wage raise will kill jobs for unskilled workers and raise the unemployment rate. The other half of economist believe that the minimum wage increase will not kill jobs and also help the economy because low-income worker are willing to spend more

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