ipl-logo

The Pros And Cons Of Increasing Minimum Wage

472 Words2 Pages

Concerns about the minimum wage increasing and decreasing has been a controversial issue for many years. Although having an increased minimum wage may be beneficial to employee’s and improve living standards, the economy could face many risks. According to an article posted in The New York Times, “California and New York last year approved gradual increases to $15 per hour. (Schreiber 2017). Recent studies have shown that popular cities and states are beginning to raise their minimum wages. This article also presents that when employers are forced to pay more in wages to their employees, they tend to hire more productive workers to offset the costs of the higher minimum, therefore, leaving more unskilled workers in the unemployment spectrum of the economy. This article …show more content…

Structural Unemployment
a. Structural unemployment occurs when there are fewer jobs than workers. This concept can be applied to the article because as the minimum wage increases, employers are going to seek out for more productive workers. Workers that possess skills that aren’t in high demand and workers that lack skills that are in high demand will most likely be unemployed due to structural unemployment because of the lack of jobs for unskilled workers.
2. Aggregate Demand
a. Aggregate demand is the quantity of goods and services demanded in the economy at any given price level. This concept can be applied to the article because as the minimum wage increases, aggregate demand in a competitive market will decrease (shift left) because unskilled workers aren’t employed and are spending less money on goods and services.
3. Aggregate Supply
a. Aggregate supply is the total quantity firms produce and sell at any given price level. This concept can be applied to the article because as the minimum wage increase, aggregate supply in a competitive market will decrease (shift left). This will result in firms having higher costs and passing the higher costs to consumers.
4. Consumer Price Index

Show More
Related

  • Summary Of The Jungle By Upton Sinclair

    1483 Words  | 6 Pages

    The level of job losses in the minimum-wage category is the critical issue of our day. It is much more difficult for someone with nothing to rise to higher levels on the economic scale. Inequality is feeding on itself. ”(Zuckerman) that leads to the next point.

    Read More

  • Summary Of Minimum Wage Hurt Low Income Workers By Jame Sherk

    646 Words  | 3 Pages

    In the article, “Minimum Wage Hikes Hurt Low-Income Workers,” Jame Sherk debates how an increase in the minimum wage would impact workers and corporations. Sherk builds his argument by first explaining the recent history of an increasing minimum wage and how much it has risen. Following, he argues why it would hurt businesses and low-income workers. Lastly, after illustrating the consequences, he offers statistical evidence to support his claim and to prove to the reader why the hike would only hurt both businesses and low-income workers. Sherk’s use of evidence and explanation offers a strong argument and a clear stance.

    Read More

  • Pros And Cons Of Raising The Minimum Wage

    1094 Words  | 5 Pages

    First, one main reason that the minimum wage should be raised is because the economy will prosper. “Economic Policy Institute stated that a minimum wage increase from the current rate of $7.25 an hour to $10.10 would inject $22.1 billion net into the economy and create about 85,000 new jobs over a three-year phase-in period” (ProCon). This quote shows that the economy will flourish from the increase of the minimum wage and that unemployment will decrease. Another quote that shows how raising the minimum wage will affect employment is “To the extent that through these contour effects it affords as much as 70 percent of the workforce greater purchasing power, it effectively increases aggregate demand for goods and services, which should ultimately lead to the creation of more jobs” (Challenger 19). Bryan Covert supports raising the minimum wage by

    Read More

  • Federal Reserve Interest Rate Essay

    589 Words  | 3 Pages

    With lower aggregate demand, businesses are unable to sell their goods and services at higher prices, causing them to lower prices in an attempt to clear their inventory. As such, the overall price level in the economy decreases. This is an application of the law of demand, which posits that a decrease in demand leads to a decrease in price, all other factors held constant. Gross Domestic Product (GDP) The decrease in aggregate demand also leads to a decrease in real GDP in the short run.

    Read More

  • Raising The Minimum Wage Analysis

    721 Words  | 3 Pages

    Desiree Ripoll Professor Heuer ENC 1102 5/30/2017 Increasing the Minimum Wage is Good for America Raising the minimum wage is not only beneficial to those who are struggling financially, America’s economy would benefit from this as well. Doug Hall and David Cooper express how increasing the minimum wage would be a tool for modest job creation in the article “Raising the Minimum Wage Would Help Lower-Income Workers”. In the article “Is a $15 minimum wage economically feasible?” Jeannette Wick-Lims discusses how raising the minimum wage is good for the economy if we adapt to the changes accordingly.

    Read More

  • Pros And Cons Of Minimum Wage

    2865 Words  | 12 Pages

    Many people believe that the minimum wage should be raised to fifteen dollars an hour, causing a lot of debate. While San Francisco had just recently raised their minimum wage to fifteen dollars an hour, it is also still expensive to live. If rest of California followed, it would not be the best thing. Raising the minimum wage to fifteen dollars an hour is too high and

    Read More

  • Minimum Wage Persuasive Essay

    551 Words  | 3 Pages

    Various arguments that have been put across for why the minimum wage should be increased will be explored. The research will provide an introduction to the issue with some historical background as well as the current dynamics surrounding the issue. After which, the direction of the paper will drive towards proving that the minimum wage should be increased by exploiting researched facts as well as evidence-based arguments that have been put forward by various experts concerning the issue. The paper will not include opposition arguments but it will focus on presenting a strong case as to why the wage should be increased as opposed to why it should not be increased or rather counter-arguing the facts presented by the other divide of the subject matter at hand. The research will use figures, numbers as well as other facts about the topic from previous research to build the case for increasing the

    Read More

  • Raising Minimum Wage Debate

    1108 Words  | 5 Pages

    With the increase in minimum wage it will increase the price for simple consumer goods like bread and milk ("Seattle Wins 'Fight for $15,' but Low-Skill Workers Lose." A.7). Typically, simple consumer goods are run by grocery stores and convenience stores. Those stores usually do not pay their employees a little more than minimum wage, but not the $10.25 that people are wanting. If this does happen then the stores will cover the new expenses by raising the prices of their goods. Raising the minimum wage just increases inflation.

    Read More

  • Persuasive Essay On Minimum Wage

    626 Words  | 3 Pages

    Americans can all agree that America is struggling to keep unemployment rates low. If the government raised the minimum wage to $10.10, a projected 85,000 jobs will be created in the next three years. Along with the increase of minimum wage, everyone will be making more money, otherwise known as wage inflation. If the minimum wage goes up three dollars, people who make more than minimum wage will get more money to compensate for employees that make minimum wage. The modern economy is far too ahead of the measly $7.25 minimum wage workers make.

    Read More

  • Essay On Raising The Federal Minimum Wage

    733 Words  | 3 Pages

    A minimum wage increase from “$7.25 to $10.10 would result in a loss of 500,000 jobs”. ("The Effects of Minimum-Wage Increase on Employment and Family Income”) This claim is better because it shows how raising the minimum wage will decrease job growth instead of increasing it. But, the minimum wage should be increased because increasing will also increase economic activity and spur job growth, decrease poverty, and improvements in productivity and economic growth have outpaced increases in the minimum

    Read More

  • Federal Minimum Wage

    1134 Words  | 5 Pages

    From the first glance, the rise of the federal minimum wage is beneficial to everyone. It will improve living standards and the country’s overall economy, create more job opportunities, and reduce the poverty rate. However, after analyzing some economic theories and reading presumption made by qualified economists the idea of increasing the federal minimum wage will not look as good as before. Oppositely to benefits the raise may adversely affect standard of living, cause layoffs and fewer hirings, or has negative effect on poverty rate. Both points of view show the significant impact that the raise of the federal minimum wage may cause and both of them are partly correct.

    Read More

  • Minimum Wage Sociology

    1153 Words  | 5 Pages

    We find no evidence that minimum wage increases between 2003 and 2007 affected overall state poverty rates. ”(Leigh, A. (2007) Proposals to increase the minimum wage are politically popular because they are widely seen as an effective way to help the working poor. In spite of it, state and federal minimum wage increases between 2003 and 2007 had no effect on reducing the poverty rates. “Minimum wage increases have thus far provided little more than symbolic support to the working poor.”

    Read More

  • Persuasive Essay On Minimum Wage

    711 Words  | 3 Pages

    A person working full time at the federal minimum wage of $7.25 per hour earns $15,080 in a year, which is 20% higher than the 2015 federal poverty level of $12,331 for a one-person household under 65 years of age, but 8% below the 2015 federal poverty level of $16,337 for a single-parent family with a child under 18 years of age (procon.org pro#2). If you put the minimum wage at $9.00, people will be able to live comfortably without unemployment rates going up. However, raising the minimum wage

    Read More

  • California Minimum Wage

    1512 Words  | 7 Pages

    Many citizens of California would naturally think about prices of products when they hear that the minimum wage will increase. An online article, by PewResearchCenter, says that “..Since it was last raised in 2009, to the current $7.25 per hour, the federal minimum has lost about 8.1% of its purchasing power to inflation”. Even though this was news a few years back, it still shows the effects of having a raise in minimum wage. It shows that 8.1% being purchased have been increased into products. There will be no point in raising the minimum wage if the price of products goes up.

    Read More

  • Essay On Increase In Minimum Wage

    704 Words  | 3 Pages

    In the past three years, many politicians and labor unions have been pushing for an increase in minimum wage. Minimum wage is the lowest set wage by a law of a government body. An increase in minimum will benefit some people, and hurt others. An increase in minimum wage will cause benefit in the short run but will be very damaging to the economy in the long run. There should not be an increase in minimum wage because it is unhealthy to the economy in the long run and it will be the major cause of job loss, increase in inflation, competition, and the price level of goods and services.

    Read More

More about The Pros And Cons Of Increasing Minimum Wage

Open Document