Minimum Wage Research Paper

In the next couple of years you could be unemployed and living in poverty. With increasing minimum wage families may soon begin to struggle. I do not agree with raising the minimum wage for it could cause increases in the cost of goods and services, human employment may be replaced by automation, and possibly increase unemployment.

First of all the minimum wage should not be increased because it will increase the cost of goods and services. For example, “A 2015 Purdue University study found that raising the wage of fast food restaurant employees to $15 or $22 per hour would result in a price increase of 4.3% and 25% respectively.” (McClure, Greg) This means that prices in grocery stores would go up by 4.3% which is making everything more expensive

because of the increase of minimum wage.In some places the effects of increasing the minimum wage are already happening for example, “NBC News found that the price of a cup of a coffee went up by 10 to 20% in Oakland, California, after a 36% minimum wage hike in the city to $12.25.”(Abramo, Allegra)With the proof of prices raising for coffee because of the minimum wage is an example of how the price could possibly continue to increase. “The Albert Hotel and Lodging Association (Canada) found that a ‘sudden and significant increase to the minimum wage’ would result in ‘[i]ncreased prices for food & beverage, guest rooms and meeting facilities.’”(Alberta Hotel and Lodging
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Association) For this is more proof that even prices for people who need to stay at hotels could become a problem because the prices would be raised and will be raised if the minimum wage increases which could possibly lead hotels into shutting down because they will not have enough guests to make money and the people who need to stay at a hotel would not be able to do so.

Equivalently important to the cost of goods and services, humans being able to work jobs may decrease due to replacement of employment with automation. According to an article by Carl Benedikt and Michael A. Osborne, it made mentioned about automation being used by companies if they are not capable of paying a higher amount of minimum wage. This means that if automation starts to be more reliable on employment than humans then eventually the long term effect is that there will be no jobs left for humans because with automation, people won’t have to pay them to work. To follow from the same article, “Oxford University researchers Carl Benedikt Frey, PhD, and Michael A. Osborne, DPhil, stated in a 2013 study that ‘robots are already performing many simple service tasks such as vacuuming mopping, lawn mowing, and gutter cleaning,”(Frey, Carl) This is proof that automation is evolving at a steady pace and could potentially be ready soon to work jobs and if minimum wage increases then taking the facts and putting it together, companies may turn to automation with no hesitation. Some places have already started the thinking process about using automation, “The Washington Post observed that as minimum wage campaigns gain traction around the country, ‘Many [restaurant] chains already at work looking for ingenious ways to take humans out of the picture, threatening workers in an industry that employs 2.4 million wait staffers, nearly 3 million cooks and food preparers

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