There could be multiple reasons for this some are minor and many are major. Looking at the big picture, small business are going to be hurt the worse by this because they are going to have to pay more out of pocket due to the pay increase. This could lead to many lay off that would increase the poverty level. "A 10 percent increase in the minimum wage reduces employment of young workers by one percent to two percent"(David R. Henderson, "The Negative Effects of the Minimum Wage). Currently there are many teenagers working.
One disadvantage to increasing the minimum wage is the possibility of a continued shortage of jobs. As the minimum wage increases, more people would want to find a job more than ever. This could cause a shortage in jobs because their still wouldn’t be enough work but the demand will be higher. The graph below shows the minimum wages from 1938 to 2007, in comparison to the poverty levels. Even though this problem wouldn’t change by the increase in minimum wage, I believe that this disadvantage isn’t that important at the current moment because it takes a while to rebuild an economy.
The cost of living would have to go down if there were to be no set minimum wage otherwise more and more people would become poverty stricken by the sudden loss of income. The unemployment rate would increase greatly if we were to abolish the minimum wage because no one would want to work for less than what they were being paid for working the same job. If no one wanted to work the same job for lower pay then the businesses would start going out business. It would just be a big domino affect that would cause more trouble than good at least for the American citizens anyway. Illegal immigrants would have a hell of a time with all the job opportunities opening up.
Take gasoline for examples as the price goes up people tend to drive less. These laws of supply and demand also affect business decisions; if wages go up employers will hire less people as this increase in average fixed cost would eat into their marginal revenue. Economists estimate that for every 10% increase in wages workforces are cut by 3% (Danzinger 2009) Minimum Wage Merrell
Tieaisja Nicole Powell Unit 9 Final Project Minimum wage essay College Composition 2 Minimum wage is considered low income. It affects the lives of people making minimum wage and also small business owners. It affects the employees because the cost of living continues to rise and minimum wage doesn’t. Small business are affected because raising minimum wage would mean they would have to hire less employees and raise the prices on the company’s products. Minimum wage is unacceptable because the cost of living will continue to increase.
Minimum wage keeps increasing when there are more workers to help people have an efficient life with a fair pay, but also it can increase for some workers to lose their jobs. The increasing of a minimum wage can benefit a lot of workers by having a better life. Wages can increase the pay of workers without any experience.
Increasing Minimum Wage The debate of whether or not to increase the minimum wage has much controversy surrounding it, but the facts support an increase. The facts show that the cost of living and inflation quickly erode the value of minimum wage without regular increases in the minimum wage. The people that would be slightly hurt by an increase when compared to the massive amount of people that an increase in the minimum wage would help is minute. Poverty in the United States is a problem that people constantly face, but with a higher minimum wage, poverty would be lessened. The many arguments for an increase in minimum wage clearly show that an increase is desperately needed in the near future.
The Fair Law Act of 1938 brought minimum wage to the United States and made workers that were nonfarm and non-supervisory workers make a set amount of money hourly, daily, or weekly that later changed to nearly all labor force. More recently, 2007, minimum wage amount increased a bunch from $5.15 to 2009’s $7.25. Today’s minimum wage is reaching numbers near double digits (depending on the state) like Washington at $9.32 an hour, or Oregon at $9.10 an hour with plans to increase it even more. With both pros and cons in minimum wage, a big debate has opened up on the effects minimum wage will have on our country which poses the question, should we increase minimum wage? Homelessness has decreased since 2007 (Katel).Katel understands that there are still a huge amount of homeless people in the United States so if minimum wage increases in 2007 potentially helped homelessness back then, then why wouldn't increasing it even more decrease homelessness.
Any additional raise of minimum wage would totally jeopardize the everyday lives of all Americans. The fewer jobs available, because of the pay hike, will mainly be the cause of the lower class workers’ unemployment. Simply, the minimum wage debate is a touchy subject among many economists and political figures. There are an immense amount of arguments toward the good and bad aspects of minimum wage, but one incontrovertible fact is that a minimum wage elevation causes loss for businesses, as well as, working people. The larger businesses try to make things seem more at ease than they truly are.
Without them there would be more cases of unemployment. That could raise taxes on our goods, which we would have to pay more for because of the farmer having to pay more for his harvest. So without the immigrants, we think everyone would suffer the consequences of paying much higher prices, living much harder life’s, and working harder