There is a lot of controversy surrounding the minimum wage. Many believe the wage should be lifted to help low-income families out of poverty. Others argue that a higher minimum wage reduces overall employment and encourages reasonably affluent workers to enter the labor force. Minimum wage increases could often lead to employers hiring suburban teenagers to replace disadvantaged adults who need a job more than the latter. The minimum wage includes positions that are entry-level to gain experience and skills necessary to become a more productive worker. As the workers become more productive, they expect higher pay and want to move up their career ladder. Two-thirds of minimum wage workers earn a raise within a year. Raising the minimum wage
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An increase in the federal minimum wage has a “ripple effect” on the other workers who earn wages near the minimum wage. The ripple effect occurs when an increase in the minimum wage also increases wages received by workers who earn slightly above the minimum wage. This would then impact millions of people in America who work at minimum wage or close to it. Although there are a lot of causes for many people to support a higher minimum wage, a lot of economists believe that minimum wage mandates are harmful for workers. They believe that setting an artificial wage prevents markets from finding an equilibrium and that impacts total employment, productivity, and wages. Economists believe that total employment would effectively be reduced. By placing a wage floor below the equilibrium wage, the rate that would be set by the market naturally, the supply of labor would increase because more workers would want the higher pay, while the demand for labor will decrease because fewer employers can pay the higher rate, thus offering fewer jobs. This could also create an uneven playing field for businesses; large businesses would be able to absorb a higher wage cost better than small businesses. By some estimates, raising the minimum wage would affect about 16.5 million
An increase in the federal minimum wage has a “ripple effect” on the other workers who earn wages near the minimum wage. The ripple effect occurs when an increase in the minimum wage also increases wages received by workers who earn slightly above the minimum wage. This would then impact millions of people in America who work at minimum wage or close to it. Although there are a lot of causes for many people to support a higher minimum wage, a lot of economists believe that minimum wage mandates are harmful for workers. They believe that setting an artificial wage prevents markets from finding an equilibrium and that impacts total employment, productivity, and wages. Economists believe that total employment would effectively be reduced. By placing a wage floor below the equilibrium wage, the rate that would be set by the market naturally, the supply of labor would increase because more workers would want the higher pay, while the demand for labor will decrease because fewer employers can pay the higher rate, thus offering fewer jobs. This could also create an uneven playing field for businesses; large businesses would be able to absorb a higher wage cost better than small businesses. By some estimates, raising the minimum wage would affect about 16.5 million