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Minimum Wage
Why the minimum wage should not be abolished in the United States.
There are diverse issues that have been debated by politicians and critics concerning the minimum wage in the United States. Some say that the minimum wage causes an increase in the unemployment rate. In turn, it causes negative effects on the nation's economy. However, the truth on this proposition is still to be proven yet. Taking the side that the minimum wage should not be abolished in the United States, I have the following arguments to present. Most of these are obtained from debates that have been conducted concerning minimum wage, as well as from available articles providing reasons why minimum wage must stay.
Much of the arguments saying that minimum wage must be abolished argue that it causes a high unemployment rate. There are a number of studies, however, that present evidences that a minimum wage does not cause less demand for labor, neither does its lifting or banning will cause an increase in employment. Kuttner (1999) presents a proof that the minimum wage does not cause negative effects. This is in relation to the 1996 and 1997 minimum wage increase. Kuttner (1999) indicates that after the wage increase, the economy of the United States had shown positive results that include the following.
A the economy started growing at four percent a year the economy started generating so many new jobs that the federal...
As indicated in an online article on minimum wage, Kevin states that And for those who insist that raising the minimum wage would cause massive economic dislocation, I'd like to point out that Congress doubled the minimum wage in 1950 with no ill effects, and raised it to about $8/hour in present-day terms in 1968, again with no ill effects.
I believe that the minimum wage law is not harmful to the people of the United States, hence it should not be abolished. In fact, based on what the minimum wage law covers, the rights of the workers are being protected. For instance, the rights of the employees are being protected from exploitation of employers, such as low salary exploitation. If the minimum wage law will be abolished, what will happen to our labor force? Chances are employers might not give the employees with the fair amount of salary that they deserve. Moreover, if there is no law that instructs employers to pay a certain minimum amount, employers might take advantage of this situation while employees cannot do anything but accept what their employees will give them. Therefore, unemployment will be a more problem if the minimum wage law will be abolished. This is especially true if the…
Bibliography
Alexopoulus, Zach. Minimum Wages: Helpful Not Harmful.
2004. Vibewire.Net. 31 July 2004. http://www.vibewire.net/articles.php?id=2642
Hornberger, Jacod. The Minimum Wage: Enemy of the Poor.
The Future of Freedom Foundation. 31 July 2004. http://www.fff.org/comment/ed1298a.asp
1999. NCPA.ORG. 31 July 2004. http://www.ncpa.org/video/trans/414.html
Outside the Beltway. 31 July 2004. http://www.outsidethebeltway.com/archives/004417.html
Minimum Wage Even though minimum wage has been around for many years, and was established to make sure that working people could survive and pay their bills, there are still many problems with it. This paper address both the pros and cons to raising the minimum wage, discussing not only how people can be helped by the increase in pay, but also how they are ultimately hurt by it to a
The company can also allow a position to go unfilled for a time to increase its leverage; the unskilled worker would starve trying to stall for a higher wage. This again invalidates the argument that the free market can set wages effectively -- it cannot given the imbalance of bargaining power between workers and businesses. The minimum wage serves a specific economic role of balancing the bargaining power between
Only 2.1% of minimum-wage workers belong to a union, versus 12.0% of the overall working population. Nonetheless, labor unions fight passionately for a higher minimum wage (Sherk). When the minimum wage rises, it becomes more expensive to hire unskilled workers. This makes the decision to employ highly paid and highly skilled workers, instead of unskilled workers, more attractive to businesses, and so businesses want to hire more skilled workers (Sherk). With
Minimum wage laws have always had a high price to pay. Essentially, there are a number of costs associated with governments implementing minimum wages on an otherwise free labor market. First, there is the issue of reconciling increased labor costs with static production profits. According to the research, "Minimum wage increases make unskilled workers more expensive relative to all other factors of production," (Gorman 2008). The increase in wages can
This creates a knock-on effect wherein this spending fuels hiring at other companies, whose workers also spend. In contrast, the additional profits earned by corporations as a result abolishing the minimum wage could be invested anywhere in the world and capital gains from stock price improvements are taxed at a relatively low rate. Without a minimum wage, there would be more Americans working, but they would not make enough
" However, the theoretical evidence that is provided in this article, to disprove other people's theory on the impact of minimum wage on the economy, seems to have the opposite effect. Statements about the, "…simplistic observation that some of the states with high minimum wages also have high unemployment rates," (http://www.epi.org/publications/entry/briefingpapers_bp150) are not completely disproved with the evidence provided to show no correlation with minimum wage and the job market.