Federal Minimum Wage

Good Essays
The federal minimum wage was passed in order to help lower income families afford higher quality goods. These goods can either be simple or complex. For example, purchasing a bed, being able to ride the bus, or being able to afford Internet. These are specific examples that will increase the standard of living. Workers who do not have the luxury of obtaining a higher education are usually stuck working at lower skilled job positions. Alternate forms of labor always threaten these certain positions. “A cashier with few skills who, following the introduction of a high minimum wage, becomes permanently more expensive than a self-service checkout machine will have no such luck” (A Reckless Wager, 2015). Companies will always look to cut costs …show more content…
Young workers trying to break into the job market will find it more difficult obtaining employment. This also affects adults with little job experience or little to no job skills. Companies who are now required to pay employees a higher wage will try to hire the most capable workers for that specific job. The idea is that job requirements will become fiercer as companies will try to get the most out of their investments. “When the population is divided on the basis of age, race, ethnicity, education, and marital status, we find that subgroups with more low-wage workers in 1989 experience larger declines in employment following the increase in the federal minimum” (American Economic Review, 1995). For example, a company has to choose between a lower class worker and a middle class worker. More than likely the middle class worker will have better education, better job skills and a higher understanding for the job. This creates a bias towards this type of worker even though the lower class worker could possibly end up being the more effective employee. This idea is very relevant in the fast food industry. “Moreover, the fast food industry is a low-wage industry even within retail trade. The industry has lobbied against increases in the minimum wage and has been a staunch supporter of a subminimum wage for youths (Bureau of National Affairs, 1985). And the fact that the fast food industry has extremely high turnover, and hires many first-time workers, makes it more likely that fast food restaurants can take advantage of the youth subminimum” (NATIONAL BUREAU OF ECONOMIC RESEARCH,

Related Documents

  • Decent Essays

    Raise Minimum Wage

    • 935 Words
    • 4 Pages

    Today there are people wanting to raise the minimum wage to $15 dollars an hour due to the rising cost of living and being in tough financial binds. Some people find themselves unable to tie loose ends because their job just isn’t cutting it. It has been primarily blamed on the jobs paying them $8/hr and not being able to survive on it alone. But could there be another culprit causing people 's wallets to feel light? Poor decisions, family upbringings, and unwillingness to get a better job are all factors that play into the shortage of cash a lot of lower middle class people are having.…

    • 935 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    Minimum Wage Solution

    • 952 Words
    • 4 Pages

    Citizens across the nation struggle to afford basic necessities of life, while small businesses struggle to maintain a profit margin. An increase in minimum wage is necessary as prices rise in every industry across the nation. However, companies cannot always afford large wage hikes, as there are many complications and cost detriments. Therefore, a solution must be found in order to address these concerns and establish a more equal economic spread. If the government established a mandatory profit cut that was spread across a company 's employee wages, many of these concerns would be addressed.…

    • 952 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    Would there be more positive or negative effects? The minimum wage shouldn’t be raised to $15 an hour because it will be a disadvantage for society. By raising the minimum wage there will be more unemployment, it will make merchandise become more expensive, and it is unfair for other people who went to school and/or risk their lives to just be paid the same amount. People who usually work for minimum wage say things…

    • 726 Words
    • 3 Pages
    Decent Essays
  • Decent Essays

    The decrease in union positions is drastic. This is important because the average union employee makes much more than a non-union employee, on average they would make ten thousand more dollars a year (Frontline Charts, 2013). Another struggle is finding a job, to add to that many of the jobs are only part time and not full time (Frontline Charts, 2013). Because of this many families cannot get benefits from their employers. Finding work is also much harder than it was because of the companies that ship their jobs overseas.…

    • 1967 Words
    • 8 Pages
    Decent Essays
  • Decent Essays

    If companies have the choice to pay their worker more or to move the company they will more than likely to outsource their companies. There is a growing concern that increasing the minimum wage would result in more businesses outsourcing their jobs overseas where workers are paid much less than $4 an hour let alone $10. People fear that if the companies are forced to pay workers more than $10 and hour, companies will ship jobs overseas for lower overheads costs than pay more for workers here. “As well-paying manufacturing jobs have left America, low skill workers have turned to low paying service jobs, filling the roles that used to be filled by teenagers and high school dropouts. The majority of new jobs created now are in the service sector.…

    • 1843 Words
    • 8 Pages
    Decent Essays
  • Decent Essays

    Minimum Wage Debate

    • 872 Words
    • 4 Pages

    Increasing the minimum wage makes it more challenging for businesses and companies to pay their employees. After watching “Should We Raise the Minimum Wage” I had a more clear perspective on the role businesses and companies play in regards to minimum wage. If minimum wage increases it means that businesses and companies have to pay their workers more causing a loss in profit. Their solution to avoiding this loss in profit is to fire employees. Entry level workers will be the first to be fired because they are not the source generating high profits.…

    • 872 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    Negatives Of Outsourcing

    • 1049 Words
    • 5 Pages

    The number of job losses is increasing as outsourcing becomes popular. For example, “Some of the regions pegged for the steepest job losses are also among the most innovative as some low-skilled jobs move away, there’s scope for other jobs.” Therefore because businesses are leaving the area to be located overseas people become unemployed and as outsourcing becomes increasingly popular as more people are becoming unemployed in the MDCs. Also Pearlstein believes that in the long run outsourcing will not be the answer and there will be many people without jobs. He states, “Outsourcing can lead to long term structural unemployment in the U.S.” Moreover a lot of Americans will be out of jobs because all of the businesses will be located overseas. So outsourcing is costing people their job and is increasing job competition in the…

    • 1049 Words
    • 5 Pages
    Decent Essays
  • Decent Essays

    Money is what programs the world. The human race literally can’t function without it. The economy also couldn’t be stable without people having jobs. Because of so many people not finding jobs that pay more than minimum wage, low-class employers are demanding to raise the wage to fifteen dollars or more. Due to many different aspects, minimum wage should not be raised to fifteen dollars or more.…

    • 1327 Words
    • 6 Pages
    Decent Essays
  • Decent Essays

    The economy is failing because it is failing to regulation the distribution of money equally. It’s clear that people are getting significantly more money than others. This unsuccessful economy challenges the American dream, which says that if you work hard then you will be prosperous, but in reality even if you work your hardest and do everything right you still might end up working in a fast food restaurant or a be a mail man. I believe education is also at fault because high-school and college don’t prepare you enough to get laid off from your job then have to recover from that. Politics is also at fault because this has been an ongoing issue for decades yet there has been no solutions.…

    • 1021 Words
    • 5 Pages
    Decent Essays
  • Decent Essays

    First of all, it leads to increase of government financial costs such as unemployment benefits, for example, because the more people are unemployed, the more money government will have to pay in order to support these people. Another negative impact is poverty. As it was proved already in this research paper, the concepts of unemployment and poverty are interrelate, which is quite logical: when people lose their jobs and become unemployed, they do not have enough money, and their expenses start exceeding their incomes, which leads to poverty. The idea is not to make a living from unemployment advantages but take advantage of the opportunities provided by the government to better the…

    • 1041 Words
    • 5 Pages
    Decent Essays

Related Topics