MinimumWage Should Not Be Increased
MinimumWage Should Not Be Increased
Thequest for an increase in the minimum wage for employees in the UnitedStates has taken center stage in recent years. There have beendemonstrations in various streets pushing for the implementation ofthe wage proposal. Some national politicians have also rallied behindthese workers. Recently the American Congress has supported the ideaand has been pushing for its implementation of in all states. Thesuggestion would more than double the minimum federal requirement andnot discriminate any state. Even the ones with low living costs wouldalso experience the same increase which would be less appealing whenrelated to others whose overheads are high. However, the move wouldnot lead to a decent living among the Americans because mostemployers would not hold to such high demands leading toretrenchments and increase in commodity prices.
Awage increment for the workers would not be possible for many smallscale businesses to place all the employees in the scheme. Some ifnot all would be relieved off their duties to ensure efficiency ofthese businesses (Ehrenberg& Smith, 2016).Most outlets like hotels in the United States pay their cooks andcashiers roughly thirteen dollars an hour. The dishwashers and othercleaners are paid eight dollars per hour, unlike the servers who havewages totaling to twenty-five dollars at a similar rate. It would befinancially challenging to ensure that all are accommodated in thewage structure of not less than 20 dollars an hour. To add moremisery to it, those of high rank who are paid more than the 20dollars would also demand an increment. The next probable move wouldbe to lay off most of the workers since most of these firms would nothave the capabilities of meeting the wage bill. They would opt forother cheaper alternatives like the automated machines instead ofincurring additional expenses in the form of salaries and wages. Themove would render the workers jobless and lead an awful life. On theother hand, if the entity agrees to include all in the proposed payscheme then there are possibilities of going bankruptcy and closure.It would mean that the current workers would lose their source ofincome contrary to their expectations of bettering their lives.
Ifthe minimum wage is fixed to be 20 dollars an hour, there will be fewhiring. Most companies will feel that they cannot hire as manyemployees as they would wish to avoid an increase in the overheadcosts (Ehrenberg& Smith, 2016).Consequently, there would be fewer job opportunities for Americans tograb unlike when the minimum wage was less than 20 dollars. As aresult, many people in the region would not have a chance to maketheir life better even after attaining credible academic standards.Reports from the Federal Reserve Bank of Chicago show that as low asten percent increment in wages reduces the employment rate by fourpercent. Worse still instead of employing few workers who might findit challenging to complete companies’ tasks, local employers mayignore the Americans who are demanding wage increment and outsourcejobs to foreigners. These people from other countries may be morethan willing to work for the local firms at a minimum wage less thanthe 20 dollars an hour demanded by Americans. The move would not helpachieve a decent life for the locals since employment positions wouldhave been occupied by foreigners.
Anadditional way that employees would suffer from the set minimum wageper hour is that it may result to increase in work load. Mostemployers would ensure their workers are working long hours tocompensate for the increase in expenses(David et al., 2016).Therefore, the employees might not enjoy a decent life after all. Itis better to remain in the current wage structure and experience somefree time to undertake other duties and relax which amounts to adecent living.
Increasingthe minimum wage to twenty dollars an hour would also result in lessappealing outcomes because prices would be escalated. Most employerswould elevate their commodity prices in an attempt to meet thefinancial demands of the employees (MaCurdy,2015).The move would create a financial burden to the consumers despiteexperiencing a salary increment. Most of the vital commodities wouldbe less affordable hence denying people a chance to live lavishly.
However,the proponents argue that increasing the minimum wage would make thelife of the workers better. The government would tax more from thesepeople’s salaries. Also through the frequent and expensivepurchases done by the locals who now have much money would increasethe amount of revenue to the government (Aaronsonet al., 2012).The extra funds would be used by the national authorities to improvethe living conditions of the citizens. Infrastructures and themedical facilities would be made available to all and more roadswould be constructed opening up remote areas. The government wouldadditionally have the financial strength to ensure that people haveappropriate quality health care at their disposal. There would be theemployment of more qualified doctors and construction of numeroushospitals near residential areas where people would access thefacilities with much ease leading to a quality life. However, thisgroup seems to be ignoring the fact that inflation may cripple theeconomy due to the increased supply of money in the country.
Inmy opinion, I would not advocate for the increment of the minimumwage to 20 dollars an hour. It would make life more difficult for theAmericans as a result of increased prices of commodities by theemployers to cater for the increased burden. It will also becomplicated if these people lack job opportunities in localindustries and other businesses as a result of high wage demands.Some people might have excelled in their academics but findopportunities few in the market as a result of reduced workforce bythe employers.
Thoughincreasing the minimum wage to 20 dollars per hour would be appealingto many workers in America, they would in most cases suffer fromincreased price of commodities and retrenchments. The fact that someemployers might extend the working hours for their employees woulddeny them the chance to live a productive and decent life. Alsolaying off due to their inability to meet the financial demands oftheir employees does not present a rightful direction in the questfor a decent life. The increase in the prices of commodities thatmight also accompany the passage of the wage proposal would cause afinancial burden to consumers. It would be arguably difficult toafford some essential commodities thus unable to conduct a decentlife. All these factors are enough to make me suggest that theminimum wage should not be increased to 20 dollars per hour.
Aaronson,D., Agarwal, S., & French, E. (2012). The spending and debtresponse to minimum wage hikes. TheAmerican Economic Review,102(7),3111-3139.
David,H., Manning, A., & Smith, C. L. (2016). The contribution of theminimum wage to US wage inequality over three decades: areassessment. AmericanEconomic Journal: Applied Economics,8(1),58-99.
Ehrenberg,R. G., & Smith, R. S. (2016). Modernlabor economics: Theory and public policy.New York N.Y.: Routledge.
MaCurdy,T. (2015). How effective is the minimum wage at supporting the poor?.Journalof Political Economy,123(2),497-545.