The Minimum Wage
Currently, there is a debate for raising the minimum wage to $10.10 an hour. The plan mathematically would lift 900,000 out of poverty, but lead to a loss of 500,000 jobs. When questioned, the result is about 0.3% decrease in employment. The reason for this is how an employer will adapt to higher wage: "That employer may handle those higher costs (wage increase) in any of several ways: cut jobs, reduce worker hours, curb summer hiring, opt not to replace workers who leave; book lower profits; or raise prices on customers" . More jobs threaten to be lost, and the number could double, a high cost for motivation.
It is hard to form an opinion on a case where it appears to equal in pros and cons, but I've come to the conclusion that this does more harm than good: although a higher minimum wage will raise people from poverty and stimulate business, it does not bode well for the future. Also, in a job, one would work up from the minimum wage to get a better pay, as minimum wage is not necessarily meant to be lived on. Making this so will motivate employees to work, but not to raise their job status.
President Obama signed an executive order making the new wage mandatory by 2015. Both parties continue to argue about this matter, but now time will prove the consequences of this decision.
article & info from cnn.com
This issue is troublesome because of the pros and cons you mentioned. Do we want employed people to make more money, or should more people be employed? Although it's a tough decision, I think that the decision to raise the minimum wage should not have been made. Like you said, people aren't really meant to live on the minimum wage. Raising it will lessen their motivation to advance in their career.
ReplyDeleteThat's very interesting. As both sides still argue I wonder what will happen.
ReplyDeleteI think people should be payed more often in my opinion but I can't make that happen.
ReplyDelete