Will Raising the Minimum Wage Help Unemployment?
When the Minimum Wage was introduced, millions of people were delighted. Those in the service, retail, farming and mining industries were particularly pleased as they were amongst the lowest paid in the US. When you are on a low wage, a rise of just a few cents per hour can make such a difference.

The Minimum Wage has risen steadily since then, and now stands between approximately $5 and $9 per hour. The rate varies dramatically from state to state and there are some states that do not have a Minimum Wage at all.

There has been lots of debate recently around raising the Minimum Wage. President Obama has suggested that he would like the federal Minimum Wage to be increased to $10.10 per hour. This has opened up all sorts of discussions about the pros and cons of an increase.

Pros

  • • Increasing the hourly rate to this level encourages people to make positive changes in their lives. Perhaps they will be able to give up their second job, allowing them to spend time with their family. Perhaps they can buy a car or even afford to take a vacation.

    • This in turn puts money back into the economy, freeing up and producing more jobs for those who are unemployed.

    • Many businesses believe that the larger economic forces were the most important aspect. Therefore, whilst raising the Minimum Wage may prevent some employers from taking on more employees, you will find that Minimum Wage jobs such as those in the service industry in restaurants, stores and motels have seen a boom in those areas where the Minimum Wage is higher, particularly where there is no sales tax.

    • The knock on effect from this is to force other businesses to raise their wages in order to attract staff. Of course, people will go where the money is to make a living.

    Cons


    • When employers have to raise the wages for their employees, a knock on effect is often a rise in prices for the customers.
    • Employees often have to work even harder for their money. When paying higher Minimum Wage, employers may not be able to afford so many staff. So, for example, a server in a restaurant may have to cover the washing up as well, as the employer will not be able to afford to fill that position.
    • Even if the number of jobs is not reduced, often the hours are. Full time jobs may become part time. Everything becomes a trade off.
  • Conclusion

    The introduction of the Minimum Wage has made millions of US citizens’ lives much better, allowing them to have a better standard of living. However, conversely, it has also made lives much harder for employers, as their staff costs have gone up, meaning they have to up their prices and maybe cut down on the number of staff they employ. So upping the Minimum Wage is a double-edged sword. It really depends which side of the fence you are sitting on.

Comments

Dylan Thompson
# Dylan Thompson
Wednesday, November 12, 2014 1:41 PM
Thank you for this information it will really help in my debate paper for my social studies class
Eduardo
# Eduardo
Tuesday, March 17, 2015 6:19 PM
Well, Gates scored 1590 out of 1600 on his SATs and drpoped out of Harvard, which means he's so brilliant AND a shrewd businessman that he didn't need the degree from Harvard. He certainly could have completed it if he wanted to, but he had better ideas. So it depends on the type of business you want to start, and it also depends on how much backing you can get for it. If you're going to build a business that designs operating systems, you'd better be really educated in computer science and math. Technical subjects like that require technical knowledge, which must be learned. Even Gates didn't just hack into a TRS-80 one day and figure out how to write code out of the blue. If you've got the capital to HIRE people like that from the git go, then it's a different story.But if you're starting a business in something like agriculture or industry, for example, and you have knowledge of it, then no you don't need higher education.I would get the multi-million dollar revenue dollar signs out of your eyes. Building a company from ground up to that point often takes decades. The secret to building a good business (beyond luck) is by first having a really good idea. What do you got that's better than your competitor? How can you get people to buy your product or service? As a business founder, it's your IDEA, and your passion for the idea, that are most important. You then have to decide how much you know about the subject, if you are willing to learn what is required if you have to, and whether or not you should create a partnership or hire employees that DO know. But that can be risky at first. You have to work with people you trust. And to gross multi-millions someday, you will definitely be a corporation that has quite a few people on the payroll. Was this answer helpful?
Michelle
# Michelle
Friday, March 20, 2015 4:07 AM
so says: No, it's not necessary but it's diitnefely an asset.A lot of people I know own their own businesses and don't have a degree. They did it because they wanted to be their own boss, and you don't need university for that It's really hard to get ahead in an established company because most of them require some kind of degree so those with experience and street smarts get shafted so the next best thing is to run your own shop as for lack of funding, most university grads are usually broke when they're done school, so they would be in the same situation as someone without a degree take care Was this answer helpful?
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