Minimum wage is described as the lowest price which workers can sell their labor and the lowest price which employers can pay their workers. In the United States, raising the minimum wage has become a prominent economic and social issue. The social class divide seems to be getting larger and a stagnant minimum wage is not a solution to income inequality in the United States. There are many proponents and opponents of the issue today, with both sides presenting strong arguments to successfully justify their positions. For the most part leading economic experts are torn, they have discovered evidence to support both sides of the issue. Numerous economists fear that raising federal minimum wages will be unfavorable for the economy, while the
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In a study done in 2014 with a colleague Professor Michael Wither, Clemens came to the conclusion that raising the minimum wage will lead to a significant loss of low wage jobs. The study examined the effects of employment and income trajectories of low skilled workers. Looking at the federal minimum wage increases from 2007 to 2009, low skill workers were separated into two groups, those whose wages were increased by the federal minimum wage increases, and those whose salary remained unchanged. The researchers tracked the employment of the two groups and discovered that the group of workers who received an increase in salary as a result of minimum wage increases were more likely to be unemployed during the recession of 2008 and the subsequent years following the recession. Clemens found that an increased minimum wage had negative impacts on both employment and income growth. Following an increase in minimum wage, workers saw a reduction in access to obtain more work experience and as a result their income stagnated. The increased minimum wage actually reduced the chances of low skilled workers being able to transition into the lower middle class bracket. Clemens is skeptic about raising the minimum wage, as he believes an increase would limit the economic prosperity of low wage …show more content…
Economists are split on the possible economic benefits and negatives of increased wages. However most economists agree that increased incomes for low class workers will have enormous social benefits and would slowly but effectively allow them to transition the lower class to the lower middle class. Economists must decide whether the social benefits that would arise from increasing the minimum wage would be worth the economic disadvantages that might result from the wage increase, like the loss of low skilled jobs. Across the United States many local governments have already made a decision. Cities like Seattle, and entire states like California have already elected to increase the minimum wage in their regions. California Governor Jerry Brown believes that “[e]conomically, minimum wages may not make sense. But morally, socially, and politically they make every sense because it binds the community together to make sure parents can take care of their kids.” In addition, many other politicians and other local leaders have a similar stance to Brown. They hold that the social benefits that come from increased incomes will have a largely positive impact on those affected, and potentially outweighs the economics negatives that could emerge later on. As more and more states individually make decisions regarding the debate only time will tell which of the views on the wage issue was the accurate one. Although considering
In a study done in 2014 with a colleague Professor Michael Wither, Clemens came to the conclusion that raising the minimum wage will lead to a significant loss of low wage jobs. The study examined the effects of employment and income trajectories of low skilled workers. Looking at the federal minimum wage increases from 2007 to 2009, low skill workers were separated into two groups, those whose wages were increased by the federal minimum wage increases, and those whose salary remained unchanged. The researchers tracked the employment of the two groups and discovered that the group of workers who received an increase in salary as a result of minimum wage increases were more likely to be unemployed during the recession of 2008 and the subsequent years following the recession. Clemens found that an increased minimum wage had negative impacts on both employment and income growth. Following an increase in minimum wage, workers saw a reduction in access to obtain more work experience and as a result their income stagnated. The increased minimum wage actually reduced the chances of low skilled workers being able to transition into the lower middle class bracket. Clemens is skeptic about raising the minimum wage, as he believes an increase would limit the economic prosperity of low wage …show more content…
Economists are split on the possible economic benefits and negatives of increased wages. However most economists agree that increased incomes for low class workers will have enormous social benefits and would slowly but effectively allow them to transition the lower class to the lower middle class. Economists must decide whether the social benefits that would arise from increasing the minimum wage would be worth the economic disadvantages that might result from the wage increase, like the loss of low skilled jobs. Across the United States many local governments have already made a decision. Cities like Seattle, and entire states like California have already elected to increase the minimum wage in their regions. California Governor Jerry Brown believes that “[e]conomically, minimum wages may not make sense. But morally, socially, and politically they make every sense because it binds the community together to make sure parents can take care of their kids.” In addition, many other politicians and other local leaders have a similar stance to Brown. They hold that the social benefits that come from increased incomes will have a largely positive impact on those affected, and potentially outweighs the economics negatives that could emerge later on. As more and more states individually make decisions regarding the debate only time will tell which of the views on the wage issue was the accurate one. Although considering