Analysis of Scheiber’s “Raising Floor for Minimum Wage Pushes Economy into the Unknown”
Franchesca Garlett
Dr. Wenyi Shen
Introduction into Macroeconomics
2103.61167
Due: November 1st, 2016
Analysis of Scheiber’s “Raising Floor for Minimum Wage Pushes Economy into the Unknown”
The article, by Noam Scheiber, “Raising Floor for Minimum Wage Pushes Economy into the Unknown” explains a mostly political viewpoint, without actually explaining, in depth, the political situation that arises from raising the minimum wage from seven dollars and twenty-five cents to an eleven dollars and fourteen cents minimum wage. So what really happens to the economy when the floor for minimum wage is above the equilibrium wage price? And why are people ignoring …show more content…
An article by Kate Taylor of Business Insider reported on Andy Puzder, CEO of Carl’s Jr. He explained that he was looking forward to moving on to a more technological dependent company, especially where their restaurants are concerned (Taylor, Fast Food CEO…). He states that this want is “driven by the push for a higher minimum wage,” he even goes as far as to say something a little more radical: "Does it really help if Sally makes $3 more an hour if Suzie has no job?" (Taylor, Fast Food CEO…). OLEA Kiosks Incorporated reports that they have seen an increase in demand for their kiosks by as much as “forty-nine percent by mass merchandisers” and “forty-six percent by supermarkets,” (OLEA kiosks, The Lab). Those statistics are from 2015, so now when the push for a higher minimum wage the demand is still going to go up, as seen in the Carl’s Jr example. Not only do kiosks take away jobs for unskilled workers a raise in the minimum wage does not mean all wages go up. There will be much more competition as many skilled workers start applying for jobs that require no skill. …show more content…
He quotes a collaborator, Arindrajit Dube, who “[argues] that it makes the most sense to treat cities like New York and San Francisco differently from other parts of their states,” (Scheiber, “Raising Floor…”). The location, populous, living expenses and all other aspects of a town do need to be taken into effect about whether or not an increase in the minimum wage is actually viable. When this is all take into consideration it changes the equilibrium wage across the United States. But, as a whole the equilibrium wage is under fifteen dollars an hour, and by analyzing the economy of Washington after its increase in minimum wage, it is safe to say that the equilibrium minimum wage is even below that of Washington’s eleven dollars and fourteen cents and San Francisco’s twelve dollars and twenty-five cents. And although Noam brings in good points with Dube he decides to close his argument with an emotional statement that tries to guilt you into wanting a minimum wage that is just too much for the economy to handle. The quote by Dan Cantor says that “Raising the minimum wage says something profound about [our] society… all work has dignity and worth, and people deserve a living wage,” (Scheiber, “Raising Floor…”). And although this pulls at the heartstrings of an socialist, you must look at the reasoning behind it. Which brings me back to the new found competition that nonskilled workers have to deal with even though
Franchesca Garlett
Dr. Wenyi Shen
Introduction into Macroeconomics
2103.61167
Due: November 1st, 2016
Analysis of Scheiber’s “Raising Floor for Minimum Wage Pushes Economy into the Unknown”
The article, by Noam Scheiber, “Raising Floor for Minimum Wage Pushes Economy into the Unknown” explains a mostly political viewpoint, without actually explaining, in depth, the political situation that arises from raising the minimum wage from seven dollars and twenty-five cents to an eleven dollars and fourteen cents minimum wage. So what really happens to the economy when the floor for minimum wage is above the equilibrium wage price? And why are people ignoring …show more content…
An article by Kate Taylor of Business Insider reported on Andy Puzder, CEO of Carl’s Jr. He explained that he was looking forward to moving on to a more technological dependent company, especially where their restaurants are concerned (Taylor, Fast Food CEO…). He states that this want is “driven by the push for a higher minimum wage,” he even goes as far as to say something a little more radical: "Does it really help if Sally makes $3 more an hour if Suzie has no job?" (Taylor, Fast Food CEO…). OLEA Kiosks Incorporated reports that they have seen an increase in demand for their kiosks by as much as “forty-nine percent by mass merchandisers” and “forty-six percent by supermarkets,” (OLEA kiosks, The Lab). Those statistics are from 2015, so now when the push for a higher minimum wage the demand is still going to go up, as seen in the Carl’s Jr example. Not only do kiosks take away jobs for unskilled workers a raise in the minimum wage does not mean all wages go up. There will be much more competition as many skilled workers start applying for jobs that require no skill. …show more content…
He quotes a collaborator, Arindrajit Dube, who “[argues] that it makes the most sense to treat cities like New York and San Francisco differently from other parts of their states,” (Scheiber, “Raising Floor…”). The location, populous, living expenses and all other aspects of a town do need to be taken into effect about whether or not an increase in the minimum wage is actually viable. When this is all take into consideration it changes the equilibrium wage across the United States. But, as a whole the equilibrium wage is under fifteen dollars an hour, and by analyzing the economy of Washington after its increase in minimum wage, it is safe to say that the equilibrium minimum wage is even below that of Washington’s eleven dollars and fourteen cents and San Francisco’s twelve dollars and twenty-five cents. And although Noam brings in good points with Dube he decides to close his argument with an emotional statement that tries to guilt you into wanting a minimum wage that is just too much for the economy to handle. The quote by Dan Cantor says that “Raising the minimum wage says something profound about [our] society… all work has dignity and worth, and people deserve a living wage,” (Scheiber, “Raising Floor…”). And although this pulls at the heartstrings of an socialist, you must look at the reasoning behind it. Which brings me back to the new found competition that nonskilled workers have to deal with even though