Minimum Wage Case Study

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Antonio French, an alderman of the 21st ward in the St. Louis City, opposes a bill that will increase the minimum wage. Due in part to the financial repercussions that he thinks the city will sustain if it is doing it alone. The City of St. Louis is proposing an increase in the minimum wage, from its current state of $7.65 to $11.00/hr., in incremental stages by 2018; by doing this they are going above the minimum wage that is set by the state and Federal Government.
French believes that jobs will be lost to the surrounding areas that will have a lower minimum wage. The increase will bring about an imbalance in the pay scale between the city and surrounding counties thereby encouraging employers to move across the city line. French doesn’t want an increase in the minimum wage to hamper the city’s ability to attract new businesses and maintain the existing ones. The city of St. Louis has been in competition with surrounding counties for a long time, not only for jobs but the population as well and because of this French wants the increase to be done on a state or federal level so that it will not cause imbalances in the job market.
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There is still worry that an increase in the minimum wage will drive employers to cut hours for their current employees or cause them to introduce a price increase for the products or services offered. Employers would expect more from their current employees; even with the cut in hours they will be required to have a more productive job performance. This could also bring a halt to the hiring and training of new employees, which is bad news for teenagers, and some college graduates, looking for entry level

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