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Positive and negative effects of raising the minimum wage
The effects of raising the minimum wage
Positive and negative effects of raising the minimum wage
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Raising the minimum wage would help reduce the need for Government Assistance programs. A government assistance program is a government funded federal aid available to low income families, programs includes: Medicare which is an income based health insurance, WIC, the Women Infants and Children Nutrition program that provides supplemental foods to women and children, Section 8 or the Housing Act of 1937 which authorizes the payment of rental housing assistance to low income households, and Food Stamps which provides food purchasing assistance. These programs were put in place to assist the unemployed and the underemployed with financial assistance after the Great Depression under the Social Security Act of 1935, which established a number …show more content…
("The History of Welfare") “Low income families make up 60 percent of those receiving food stamps, and 47 percent on Temporary Assistance for Needy Families (TANF). According to a 2014 report “Local Minimum wage laws: Impacts on workers, families and businesses” from the University of California, The authors concluded that the enrollment in public assistance programs coincides with the federal poverty level and that increasing the minimum wage reduces public assistance, participation.” They suggested that a 10 percent increase in the minimum wage reduces food stamp enrollment by anywhere between 2.4 to 3.2 percent ,and reduces program expenditures by 1.9 percent. During President Obama’s 2014 state union address, he urged Congress to increase the minimum wage to $10.10. A report from the Congressional Budget Office projects that an increase in the federal minimum wage to $10.10 per house will result in higher paychecks for 16.5 million employees. Amongst those 900,000 individuals will rise above the poverty
Imagine a world where you are working overtime, seven days a week, yet your kids are starving. You can’t get the education you need because you don’t have the time and money to afford it, and you can’t change jobs because this is the only one you can get. Unfortunately, this is the reality for millions of Americans living today. The federal minimum wage is too low to help families, and actually mathematically speaking, too low to survive on. The quality of life for minimum wage families is terribly low, and that is unacceptable. As humans, we should be looking after others and helping the poverty come out of their continuous cycle. Raising the minimum wage would not only help families be able to afford a better quality of life, but help them to afford healthy food, get an adequate education, and invest in the necessary health care they need.
Assistance was provided to lower class citizens through New Deal programs. Aid was given to farmers and poor citizens through acts and agencies such as the Rural Electric Act, Red Cross, Salvation Army, and Taylor Grazing Act (“New” 9; Young 159). This government support helped alleviate the poverty resulting from the Great Depression. Over time, these programs assisted in forming a middle class, lowering the poverty rate and allowing a better quality of living for American citizens. In addition to providing assistance to the lower class, the New Deal formed government entitlement programs. Service organizations, such as Social Security and Financial Aid, were created (Brinkley 597). These types of programs influenced Americas relationship with the government, by forming a stronger federal power willing to help the lower class, many of which are still intact today. Branching off these original entitlement programs, there are many government agencies and programs that aim to aid and support the lower class. Food stamps, Medicare, Medicaid, Disability, unemployment compensation, and benefits provided for Veterans are all governmentally funded organizations that assist the lower class population (“Budget” 2). The New Deal influenced the relationship between citizens and the American government today by
The United States minimum wage is not indexed to inflation. Due to this fact, the purchasing power of minimum wage falls as the price of consumer goods increases. The current hourly minimum wage is set at $7.25, however many states do pay above this rate. One example of this is in Michigan, the current hourly minimum wage is $7.40. The last time a change occurred to raise minimum wage was in 2009. President Obama has put out a proposal that is designed to raise the federally required hourly minimum wage to $10.10 in 2015. The public opinion of this proposal is all over the board ranging from a positive outlook to a negative one. Some of the negative remarks are that it would dampen the economy and shrink the hiring done by small businesses. “The Household Survival Budget for the average New Jersey family of four is $58,500 and for a single adult is $25,368 in 2010. These numbers highl...
Minimum wage is a topic that has been popping up since the 1980s. From whether we should lower it, or even raise it, but now in the 2000s minimum wage has been the center of attention more than ever. There are two sides to this topic of minimum wage; whether it creates more jobs or does not create jobs. Those who argue that raising minimum wage will create more jobs will have a rebuttal which is that it does not only cause the loss of jobs but that it would make things much worse and vice versa for those arguing raising minimum wage will cause loss of jobs. There will be two authors representing opposite views, Nicholas Johnson supporting minimum wage will not cost jobs with his article “ Evidence Shows Raising Minimum Wage Hasn’t Cost Jobs”
On April 4, 2016, California Governor Jerry Brown signed a bill that would significantly raise the minimum wage for California workers. By 2022, California 's workers will receive a minimum wage of $15 per hour (Kurzweil, Anthony, Sara Welch, and Kareen Wynter). Brown signed this bill because employees cannot live above the poverty line if their minimum wage is not proportional to the cost of living (Scheiber, Noam, and Ian Lovett). The purpose of the minimum wage is to ensure that workers can provide essential amenities for themselves and their families. Many economists have been in a debate about this topic with mixed feelings, whether increasing the minimum wage would be a reasonable legislation or not. For most average American workers, at first, the idea of raising their salaries might make them feel thrilled and optimistic. However, increasing the minimum wage will have its pros and cons effect on the economy. Despite numerous of arguments from both sides, a compromise can be met regarding minimum wage.
Poverty continues to grow in America. The average minimum wage in the United States is $7.35 an hour- far too low in today’s society. Key expenses, for example, gas and housing prices, have gone up significantly since the minimum wage was last changed in 2007 (Wagner 52). The laws creating the minimum wage were intended to improve the standard of living and decrease poverty. Raising minimum wage is a vital step in decreasing poverty and giving every family the opportunity to survive and succeed. Millions of hard-working Americans are below the poverty line and need an increase in pay. Minimum wage must be raised because it will diminish poverty and assist the working class to support their families.
In the 2013 State of the Union, President Obama proposed raising the minimum wage from the current $7.25 to $9.00 by 2015. This has caused arguments between the rich, small businesses, minimum wage workers, and the unemployed because it affects each of them differently. Obama’s plan is to bind the minimum wage to the cost of living, which ensures that minimum wage goes up with inflation. In general, this benefits minimum wage workers by improving their standard of living.
The New Deal occurred in 1933 when 13 million American workers lost their jobs. As a result of the massive job loss, thousands of workers demanded union recognition, unemployed Americans demanded food and shelter, and farmers demanded higher process on their goods. Federally funded jobs and social welfare programs to help the poor were set up by President Roosevelt in order to please the demands of the American people. The New Deal was established with the intention of improving lives, to save capitalism, and to provide a degree of economic security. In 1935, President Roosevelt passed the Social Security Act which, according to Katznelson, Kesselman, and Draper, “offered pensions and unemployment compensation to qualified workers, provided public assistance to the elderly and the blind, and created a new national program for poor single mothers” (332).This act allowed states to set the benefit level for welfare programs, which was set quite low (Katznelson, Kesselman, & Draper, 331-334). The Great Society programs were established by Lyndon Johnson in 1964 when Johnson declared war on poverty. This was would be the action that initiates the Great Society programs. The government used the New Deal as a foundation to build new welfare programs. Medicaid and Medicare were created to help poor and old people with their medical costs. Head Start was established to help low income
Some think that the minimum wage should not be raised, but others think that the minimum wage should be raised. If one had to be chosen, raising the minimum wage would be better. The minimum wage should be raised because if you were to work full time on minimum wage, you are below the poverty line; Also states that did raise the minimum wage above the federal standard have had more job growth than states that did not. Finally, "Minimum wage workers are much more likely to immediately go out and spend that extra money in the economy," says Heidi Shierholz of the Economic Policy Institute, which favors raising the minimum. "That's because they're often living paycheck to paycheck."
Most people during their lifetime have worked for a company in which they received minimum wage, I know I have and I am only 19 years of age. Well in 2013, 3.3 million people of the American workforce made the minimum wage, and of that 3.3 million people, nearly fifty-five percent were adults over twenty-five years old working full-time. With the current minimum wage at $7.25, there is no doubt that it is not sufficient to support a family with that amount. Although many people and many industries believe that the minimum wage should be raised to as much as $15 per hour, raising it to that level may be extreme. Minnesota raised its state minimum wage from $8 per hour to $9 per hour for companies making over $500,000 annually, effecting more
It is very difficult to live in America if you are living off of minimum wage, and many Americans are living off of it today. Raising minimum wages has its benefits like gaining more money to live better, but people do not see the down side of the increases in wages. With the increase in minimum wage, it also causes the cost of living to increase. How can this help the economy or help people? Minimum wages in America should not be increased because it will cause cost of living to increase, reduce employment, and cause businesses to lose money and workers.
Today the federal minimum wage is $5.15, but should be about $8.50 if Congress had adjusted it for inflation over the past 35 years. While $5.15 may not seen that bad, when factoring in such variables as sky rocketing gas prices, budgets can get pretty tight. David Shepard, a sophomore at Wayne State University, worked at a Meijer Retail and Grocery Superstore for over two years while in high school. At the time Shepard lived with his parents and didn’t have to worry about paying rent or buying groceries, all that he had to pay for was filling up his gas tank and paying for his car insurance. Shepard recalled, “It was all I could do to pay for the basics like gas and bill’s, I barely had any money to have fun on the weekends”. This is only an example of a high school student that can nearly slip by on minimum wage with only a few expenses. There are 1.8 million people in America with children under the age of 18 that would benefit from an increase in minimum wage (Minimum).
In this article, the author talked about increasing the federal minimum wage in Washington which Obama favors to be 10.10 $ an hour. He mentions a long with the 16.5 million workers that a 10.10$ minimum wage would help directly through changing. This change would improve the family incomes of more than low wage workers and above the poverty line. Additionaly, increasing wages is good for business because the gross domestic product(GDP) will comes up. Furthermore, a minimum wage could affect consumer price and higher-wage earnings.
"Raising the minimum wage will benefit about 28 million workers across the country. And it will help businesses, too - raising the wage will put more money in people's pockets, which they will pump back into the economy by spending it on goods and services in their communities." -- President Obama
In the 2014 State of the Union address, President Obama called on Congress to raise the national minimum wage from $7.25 to $10.10 an hour, and soon after signed an Executive Order to raise the minimum wage to $10.10 for the individuals working on new federal service contracts. An increase in the minimum wage has been a topic of discussion for many years now, and it looks like this year will finally see the first increase of minimum wage in 10 years. Not everyone agrees that there should be an increase, but many states have already raised their minimum wage rates because of the federal government’s inaction. Iowa raised the state’s wage, and it will rise again in 2016. Clearly there are benefits to a higher minimum wage; the current minimum wage in the United States should be raised because it helps the economy by increasing employment, and it is now at the lowest value it has been in more than 50 years, causing hardship for earners of minimum wage.