The Fight on Minimum Wage Minimum wage. The lowest amount of money regulated by the government in which businesses must pay their employees. Minimum wage is slowly on the rise, with dramatic proposals in the last few months. However the raise in minimum wage could cause great harm to the United States economy. The minimum wage should not be raised because it would increase the price for the consumer, it could harm the small businesses of America, and it could cause millions of minimum wage workers to be laid off.
With a fall in tax revenue, the nation’s income as a whole is reduced, which decreases the amount of money in circulation, increasing the United State’s federal debt. Also, government pays for the welfare programs, so if there are more unemployed people, that means more money from government to support those
With a declining population, the government’s economy will, too, decline due to the little occupations/participations, low amount of taxes, henceforth increasing the taxes for each individuals (however, mentioned previously, this may be a better solution). And lastly, the possibility of local residents traveling far to apply for the occupation in which one wishes for very likely due to the fall of employment (government.nl). This is what worries most governments, however, there more factors in which should be taken into consideration. Stated previously, taxes are more likely to increase for individuals in Germany due to increase of dependency ratio. Henceforth, individuals born in a year where the population has an uneven number of children, working age group, and retired people, they have the responsibility to pay more taxes for the abundance of retired elders.
This was similar to the United States of America, as the US was also trying to industrialize with a purpose of factories and people working in them. A big factor of the industrialization that both America and Russia shared was that both of these countries had a very unfair system for workers. The pay was not great, and people who were poor had it even worse. There is even an old saying that fits this very well, “The rich get richer”. This is true because the people who were already poor, who were working for the money so they could afford things like homes, food, water, and clothing, were staying poor, because their pay was so low that at the rate of them using their money for necessities, they were earning barely enough to afford them.
In addition, it can also deteriorate the core of the company by reducing the number of employees and as a result causing an insufficient workforce. “Workers originally want unions primarily for defensive purposes -- to protect against what they see as arbitrary decisions, such as sudden wage cuts, lay-offs, or firings. If they are going to compete successfully in an economy that can go boom or bust, then they need a great deal of flexibility in cutting wages, hiring and firing, and adding extra hours of work or trimming back work hours when need be.” (Domhoff, 2013) Another example is that, when being protected under a union, it makes it difficult to discipline workers. Participation in a union starts to become more about the circulation of connections rather than skills proficiency. Also, despite having a voice in a union, there may still be aggression and lack of cooperation and collaboration; which is vital in a workplace.
Employers may choose to lower the number of staff in order to still provide these benefits for employees, which would increase unemployment, or disband these programs yet keep their original number of employees. If these programs are disbanded, then the employees may have to look elsewhere for health care and this adds an added expense to their monthly salary. In this case, the higher minimum wage does not benefit but can rather harm employees as, often times, private health insurance is a much greater expense than the health insurance companies provide. Employers may also cut hours in order to still pay employees at the higher minimum wage but still not provide these benefits seeing as Federal Law does not require part-time employees to be provided health insurance or other benefits by their employers. This puts added strain on employees because, while earning more, they would be working less and would still need to purchase health insurance and other
By the government raising minimum wage, this will force owners to compensate with their employees. This could result in letting employees go, giving employees very limited hours or cutting down the owners pay. Whichever way it goes, this is a downfall to the economy because people will end up losing their jobs, businesses will lose money which would decrease total profit and it could result in the closing of businesses and
Economical effects: Concern about the economical impact of immigration has divided into two aspects: the effect on the change of wages; and the development and contribution of different industries. First, the numbers of immigrants increase leads to the average wages decrease. Since the population of the country increase with the labor supply, it means more people would have to look for jobs in every wage levels to earn a living. As people need to compete intensively in order to get the job, companies can pay lower to the workers to obtain employment, which reduces their labor cost to earn more revenue. According to Immigrant Families and Workers (2003 November), it stated that immigrants’ hourly wages are lower on average than those for natives, and nearly half earn less than 200 percent of the minimum wage—versus one-third of native workers.
After a strike, the employees’ performance becomes reduced significantly in their working field. Consequently, making the organization suffer from slow growth in their rate of production. If the concession of the strike involves only the return to work and does not focus on the needs of the workers, during the recession period, an organization must be prepared to focus on any form of reduction productivity, and the employees work effort. Another outcome is that strikes tend to intensify the relationship between the employees and employer creating a problem in both disseminating information and work coordination between them. Consequently, the result of poor communication between the employer and employees is a low performance, which may eventually lead to low
GDP is the total value of the annual output of goods and services produced within a nation's borders. It excludes the foreign output of domestic firms and includes the domestic output of foreign firms (Mankiw). Because of low GDP, companies' level of output they produce annually has been reduced. One common mistake of some companies during recession is when there is less money to go around, they will cut off their budgets. When this happens, it is inevitable to lay off key employees to reduce their expenses.
The effect of the recession on HBCUs As we know a recession is defined as a temporary decline in income due to reduced trade and production activity. Everything in society is ran by a sort of system. For example, in order for a company to thrive it must have two things, workers and production. If there are not any workers, than there is little to no production unless the company is ran by machines. If there is not any production than the chances of workers being laid off increase based on how many people are needed for certain jobs through out the company.
Recession also aids to cease the industries and various organizations due to of low investment leading employees to loose their jobs eventually leading to decrement in income flow in nation. In addition, recession causes investments and government expenditures to go down because of the low income level and low consumption. It causes industries to collaps, firms to lower the costs of production. Eventually leading to unemployment.
Although there are many ways to look at minimum wage, such as the increase and decreases, and how it will affects today 's economy it has both negative and positive effects. I believe that the minimum wage has an overall negative impact because whenever the minimum wage is increased it only makes more people recede into poverty when it is supposed to do the reverse effect. Minimum wage was originally made for people just starting out or a pay for low-skilled employees. I believe that if people can 't afford the stuff they need because of a minimum wage, then they should work harder to either get a pay raise or move to a higher paying job. This would not only help our economy grow but help people out of debt and poverty.
The more people that work and make an income, the more money people are going to spend. The less people there are working, the less people there are making an income, and then they do not have the money to spend freely. When large amounts of people are unemployed, it will hurt the rest of the economy, creating a cyclical problem. As unemployment rates grow, people are not making enough money to buy more than what is necessary, and because of this, companies will suffer from less consumer demand, and lose business. As they lose business, they may have to make cuts of their own, causing the unemployment rate to once again rise, and a cyclical effect to take place (Ryan, 2015).
Minimum wages result in unemployment because the number of employees seeking employment is exceeding the number of employees organizations are wanting to hire. For example, teenage workers with increased minimum wages results in less job opportunities for other teenagers who drop out and decided to join the workforce ;minimum wage alters the minimum demanded and minimum supplied. Increasing the minimum wage will decrease the need of workers in the market because employers will have to cut costs to pay the new minimum