Should Congress Raise Minimum Wage?

Should Congress Raise Minimum Wage?

As our federal government debates the idea to raise the minimum wage, there are several interesting questions that occur. Most importantly, should we raise the minimum wage? I believe it is a bad idea to raise the minimum wage from $7.25 per hour up to $10.10 or more in a short period of time. I will explain why raising minimum wage radically would kill jobs and hurt our economy.

The main reason raising the minimum wage radically would kill the economy is the pressure it would place on small businesses. According to TheWashingtonPost.com article, Small Businesses are the backbone of the economy. They also cited that many studies from the U.S. Small Business Administration show small firms employ just over half of the private-sector workforce. Further these small firms have accounted for nearly two-thirds of nation’s net new jobs over the past decade and a half. Small business would not be able to afford the extra pay increases of the dramatic new pay scale. The small business owner would have to cut workers or cut hours to offset the pay increases. This would have a profound effect on the current economy. Also this would have a profound effect on other sectors of the economy. After reading TheWeek.com article, "There's no doubt that a higher minimum wage would create an immediate drag on earnings and create pressures for higher prices," I feel raising minimum wage radically would more likely lead to higher priced goods and products that you buy. The increased cost on the company from raising minimum wage would have to be absorbed by the consumer. This would be a direct effect of raising minimum wage approximately $3 in a short period.

There are several things which complicate the situation ...

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...y. Since that has not been the case, the government should consider an alternate plan for catching minimum wage up that isn’t so drastic for the small business owner.

Works Cited

Dunkelberg, William. "Why Raising The Minimum Wage Kills Jobs." Forbes. Forbes Magazine, 31 Dec. 2012. Web. 01 Feb. 2014.

Harrison, J.D. "Who Actually Creates Jobs: Start-ups, Small Businesses or Big Corporations?" Washington Post. The Washington Post, 06 May 2013. Web. 31 Jan. 2014.

Hernandez, Sergio. "How Would Raising the Minimum Wage Affect the Economy? - The Week."The Week. THE WEEK Publications, Inc, 21 Feb. 2013. Web. 31 Jan. 2014.

Saltsman, Michael. "Raising Minimum Wage Won't Lower Poverty." CNN. Cable News Network, 01 Jan. 1970. Web. 02 Feb. 2014.

Wittner, Lawrence. "The Minimum Wage Should Be Raised."The Huffington Post. TheHuffingtonPost.com, 10 Nov. 2013. Web. 02 Feb. 2014.