How Does The Minimum Wage Affect The Economy

Good Essays
Minimum Wages
The federal minimum wage was introduced in 1938 during the Great Depression under President Franklin Delano Roosevelt. Each state in the United States has laws on minimum wage. The minimum wage set by each state is suppose to increase the ability to support standard living and reduce poverty. When defining poverty, the words inferior, insufficient and extremely poor comes up. Therefore, minimum wage is doing its part some what to the economy by keeping some workers at minimum wage from being extremely poor but still poor. The nation minimum wage is 7.25 an hour but how can a person live off minimum wage? This essay will explain how minimum wage affects the economy.
So who works for minimum wage and why? Usually the first job a person has is when they are in high school. Places that usually hires a high school student are fast food restaurant, grocery stores and some department store. When hiring a high school student expectation are extremely because they are hiring
…show more content…
Raising the minimum wage would increase economic activity and spur job growth. How every there will always be a group that do not want to work and is comfortable with the government taking care of them. At the same time increasing the minimum wage would reduce poverty even if it is only by 20 or 30 percent. If company have to lay off workers because the work they are doing do add up to the labor work those people would be job less. A higher minimum wage would reduce government welfare spending but once again only by a little because people that will get laid off have to be put into accountability. Increasing the minimum wage would force businesses to lay off employees and raise unemployment levels. It would hurt businesses and force companies to close. Teenagers and young adults may be shut out of the workforce if the minimum wage is increased. Who would want to hire a young inexperience person and have to pay them 10 – 15 dollars an

Related Documents

  • Decent Essays

    Minimum Wage Rejection

    • 1087 Words
    • 5 Pages

    Rejection for Higher Minimum Wage Minimum wage workers deserve minimum wage the way it is now. If the government raises minimum wage then it will just cause the cost of living to go up and decrease the value of the dollar. If minimum wage is increased, then everybody’s wages would eventually rise too and then minimum wage workers would continue to ask for more money because they would end up at the bottom of the chain again. Most people benefitting from a wage increase are not even in poverty. Minimum wage is a good amount right now considering that the amount of people making minimum wage who earned an income at or below the poverty was only 2.7% (Palumbo).…

    • 1087 Words
    • 5 Pages
    Decent Essays
  • Decent Essays

    If the costs of goods rise the amount of sales will drop which is simple economics this would bankrupt businesses as a result of being required to pay their employees more, but are making less money. The idea behind raising minimum wage is to make it so more people aren 't in poverty, but raising the minimum wage will cause businesses to close putting people in poverty or deeper poverty than they are already experiencing. Also raising the minimum wage will take away the drive to do better and work for what you want to be. If they raise it to the amount of 15 an hour like some are calling for that is what a police officer or a paramedic makes currently why would someone want to put their life on the line when they could flip burgers and make the same money? The types of jobs that pay minimum wage are not meant to be permanent career jobs they are meant to be jobs for school kids to make enough money to pay bills and survive…

    • 810 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    Minimum Wage Solution

    • 952 Words
    • 4 Pages

    These repercussions would be immense, and debatably overshadow the benefits. Furthermore, an increase to $15 for San Francisco’s minimum wage would reduce the city’s employment by an estimate of 15,270 private jobs. Although cities that rely on larger businesses, such as Chicago, would be affected, San Francisco would be ravaged by employment because of their many small-scale shops and businesses. The unemployment boom that resulted would cause further wage class between a larger group of people. Although it would benefit many, the result would be catastrophic to an already massive divide between social classes.…

    • 952 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    Other factors that have shown to be good for increasing minimum wage is employee turnover will be low. Workers are going to want to show up for work, be motivated and fighting for that job, which then decreases the amount of time and money employers have to use on finding and training new faculty. Having an increase wage also results in more spending money for the employee which then helps the community all around. The Economy Roundtable suggested that if workers received the 15 dollar minimum wage, then the county which was tested in, could receive 9.2 billion dollar revenue in sales. Having the federal minimum wage rate raised could possibly have a good impact on the United States economy according to some…

    • 1049 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    There is an issue that people want to make to increase minimum wage. They want to raise the minimum wage to make it easier to reform the process and ultimately reduce subsidies. For many people who work at full-time jobs for minimum wage, there is no way for them to make ends meet except by taking government subsidies. They argue that, if the minimum wage is increased, the minimum wage can help eliminate the need for government welfare. The government should increase the minimum wage so people can make a livable wage to support themselves financially and it would help for single parent families.…

    • 1024 Words
    • 5 Pages
    Decent Essays
  • Decent Essays

    Many other low wage jobs are paid at specified increments above the minimum wage, so those workers also get a raise.” (Hence) This proves that raising the minimum wage would help low wage families to keep up with inflation and it would also productively flow with the economy. If the minimum wage was increased it would help families get off food stamps and other government aid which would put more tax money into other causes and back into the pockets of americans. “ Even a full time minimum wage worker with a family of 5 would fall under the poverty line with government aid by about $1000.” (Furman) More than 30% of minimum wage families have to get government aid because their income isn 't enough to support their…

    • 1314 Words
    • 6 Pages
    Decent Essays
  • Decent Essays

    If all fifty states in 2014 would have raised their minimum wage by one dollar, an estimated 2,790 fewer low birth weight births would have taken place (Leigh 1355). Explaining the pros and cons of raising minimum wage, the article between Reihan Salam and Dr. Paul J. Leigh explains how an increase can help and hurt many different kinds of people. Salam disagrees with raising of minimum wage. He claims that it will hurt the less educated people and it will be harder for them to compete for a low paying job with the highly educated (Salam). Conversely, Dr. Paul J. Leigh wrote claims that raising the minimum wage will help people and make for more affordable health care.…

    • 1747 Words
    • 7 Pages
    Decent Essays
  • Decent Essays

    Restoring the consumer demand is an essential key for stabilizing the economy and allowing local businesses to expand and eventually create jobs. Although to many minimum wage seems like an absurd idea. There are many people who think raising the minimum wage is not beneficial because it will increase inflation and trigger another recession, the argument of raising minimum wage is not only a economic discussion but a political fight as well. Unlike higher earners who can afford to save some of their income, working families spend the money they earn on necessities at local businesses, which immediately re-circles the money back through the economy. Raising the minimum wage is a key strategy for increasing consumer spending, and simply one of the only ways to do so that doesn’t harm state or federal budget deficits.…

    • 1266 Words
    • 6 Pages
    Decent Essays
  • Decent Essays

    Most assume that with salaries being higher, companies will try and cut losses by laying off workers in order to save money. But there is little to no research to support this. In reality increases in the minimum wage have at the very least not affected the unemployment rate and at the very best have improved upon it. During the Great Depression when the federal minimum wage was first enacted unemployment rates had skyrocketed, reaching the very high number of up to nineteen percent. After the implementation of the federal minimum wage the unemployment started to lower.…

    • 1729 Words
    • 7 Pages
    Decent Essays
  • Decent Essays

    Minimum Wage Amendment

    • 1587 Words
    • 6 Pages

    These types of people would be mostly employers. Employers want to pay employees what they feel is necessary for the work that is given. Employers don’t want to give their employees more then they absolutely have to, because the more they give their employees the less they have for themselves. Increasing the minimum wage though would help these individuals in the end. It would drive our economy and cause businesses to boom.…

    • 1587 Words
    • 6 Pages
    Decent Essays