In a society where money is seen as the key to success, opportunities to earn more money by raising wages are attractive; however, raising the wage will hinder success as a whole. Research shows that raising that wage can be a catastrophic move for everyone, including the consumer, employee, employer, and even the economy (Wilson).
Consumer product prices can skyrocket as a direct effect of a wage boost (Wilson). A study conducted in 2004 showed a 4% increase in consumer goods' prices and its correlation to a 10% increase in the minimum wage (“Four Reasons”). Studies in 2007 and 2011 found similar results (Wilson). Since money is set up as an equation; adding money to one side automatically means the other side receives the increase as well. …show more content…
Numerous studies show that increasing the wage to $9.50 will help only eleven percent of the impoverished population (Hassett and Strain). Why? Most people earning minimum wage are teenagers making money for their leisurely expenses or adding some money onto the primary jobholder’s salary while most of the people who are financially suffering are earning over the minimum wage (Hassett and Strain). If the wage were to increase, it would also severely hurt low-skilled workers (“Four Reasons”). Studies found that adding less than two dollars to the wage increased the unemployment for low-skilled workers by around 1.6 percent (“Four Reasons”). According to economist Gary Becker, “A rise in the minimum wage increases the demand for workers with greater skills because it reduces competition from low-skilled workers” (qtd. in Wilson). Many low-skilled workers left unemployed will continue to fall lower under the poverty …show more content…
Cases of this were first spotted in Puerto Rico in 1938 during the enactment of the first salary increase (“Four Reasons”). Approximately 120,000 Puerto Ricans found themselves unemployed after 1938 (Wilson). In more recent years, President Barack Obama made an executive decision to suspend the wage increase after seeing the damaging effects on American Samoa (a U.S. territory near Fiji) between 2007 and 2009 (Wilson). Raising the wage also means employers have to spend more money on labor costs. In theory, that is fine; however, someone has to pay the money whether it be the consumer or the employer (Hassett and Strain). If the employer chooses to reduce the increased expenses by reducing the amount of labor and leaving only higher-skilled workers, the number of unemployed workers will surge (Hassett and
Consumer product prices can skyrocket as a direct effect of a wage boost (Wilson). A study conducted in 2004 showed a 4% increase in consumer goods' prices and its correlation to a 10% increase in the minimum wage (“Four Reasons”). Studies in 2007 and 2011 found similar results (Wilson). Since money is set up as an equation; adding money to one side automatically means the other side receives the increase as well. …show more content…
Numerous studies show that increasing the wage to $9.50 will help only eleven percent of the impoverished population (Hassett and Strain). Why? Most people earning minimum wage are teenagers making money for their leisurely expenses or adding some money onto the primary jobholder’s salary while most of the people who are financially suffering are earning over the minimum wage (Hassett and Strain). If the wage were to increase, it would also severely hurt low-skilled workers (“Four Reasons”). Studies found that adding less than two dollars to the wage increased the unemployment for low-skilled workers by around 1.6 percent (“Four Reasons”). According to economist Gary Becker, “A rise in the minimum wage increases the demand for workers with greater skills because it reduces competition from low-skilled workers” (qtd. in Wilson). Many low-skilled workers left unemployed will continue to fall lower under the poverty …show more content…
Cases of this were first spotted in Puerto Rico in 1938 during the enactment of the first salary increase (“Four Reasons”). Approximately 120,000 Puerto Ricans found themselves unemployed after 1938 (Wilson). In more recent years, President Barack Obama made an executive decision to suspend the wage increase after seeing the damaging effects on American Samoa (a U.S. territory near Fiji) between 2007 and 2009 (Wilson). Raising the wage also means employers have to spend more money on labor costs. In theory, that is fine; however, someone has to pay the money whether it be the consumer or the employer (Hassett and Strain). If the employer chooses to reduce the increased expenses by reducing the amount of labor and leaving only higher-skilled workers, the number of unemployed workers will surge (Hassett and