Min. Wage Debate: Raising the Bar for Low Wage Workers - Essay Sample

Introduction

A minimum wage is said to be the lowest possible amount that an employee can be paid by his/her employer. In the United States, the standings of the federal minimum wage are currently at seven dollars and twenty-five cents an hour. This is extremely low in the current generation. Due to the dissatisfaction by those earning the minimum wage, the heated debate concerning raising the minimum wage arose and is currently ongoing. For many decades the process of settling on a perfect minimum wage has been a debatable issue. This is because the conclusion to be met needs to not only take into consideration the employee but also the employer. The last time minimum wage was increased was in 2009 when the wages raised from six dollars and fifty-five cents to the current stand of seven dollars and twenty-five cents. The essay seeks to discuss why minimum wages should be raised.

Is your time best spent reading someone else’s essay? Get a 100% original essay FROM A CERTIFIED WRITER!

Save 25%

It is believed that poverty should not strike anyone who works full time. This is quite meaningless since that is not the case in the current world. In 1968 the minimum wage was high enough and could typically cater to three family members comfortably. In 1980 the number had reduced to two whereby the then minimum wage could only cater to two family members. In the current world, the minimum wage of any working parent leaves one child in poverty. It's quite unfortunate that each day a common citizen goes to work only to benefit the investor and the country. If the minimum wage was to be calculated with the rising productivity in any organization then the current wage would have been approximated to twenty-two dollars per hour. Since that is not the current fact, this explains why many parents work full time but still live in poverty. This, therefore, indicates the reason why the population of most countries lives below the poverty line (Dube, Lester, & Reich, 2016).

Nowadays education is considered a key feature for one to be employed but the education cost has extremely been on the rise for the last years. Future work is expected to involve consideration of good education due to technological advancements. Children may therefore not be in better positions if their parents cannot afford the high education costs. Employees should then be paid deserving wages than what is being offered currently. There have been cases where children struggle hard to pay for their education. Some have opted to drop out because they cannot afford the tuition fee due to the low earnings. This is quite unfair for the children whom we consider as our future (Levin-Waldman, 2017). Increasing the minimum wage will, therefore, provide an opportunity for both parents and children to better their lives.

An increase in the minimum wage would boost the employees' productivity in any organization. Research is done by Meer, & West, (2016) indicates that when workers are offered better pay, their morals and work ethics improve thus boosting the firms' productivity. This also gives them a better physical and mental health and reduces fatigue levels. By boosting business productivity, this will indicate a rising economic level in the entire country. More money will be available for citizens to spend thus indicating a positive economy. This will also uplift the small businesses in the market which will be forced to improve their productivity.

Increasing the minimum wage will promote the consumers' spending thus boosting the economy. Studies indicate that two dollars and fifty-five cents increase in the minimum wage would raise low wage workers by forty billion dollars thus resulting in a high rate of employment (Karabarbounis, 2018). A higher employment rate will then indicate more income earners. This will raise people from their poverty levels and boost their standards of living. High living standards will then relate to a better economy. Additionally, the higher the income the greater the demand for goods and services. The high demand will require more supply thus the need for a higher production hence boosting the economy. Economists have shown that promoting purchasing power by putting more money in people's pockets raises consumer spending and creates a positive effect on the country's economy.

A higher minimum rate would raise the living standards for poor workers. An increase of minimum wage to fifteen dollars an hour in the future would drop 1.3 million jobs as studies indicate but will lower the number of poor citizens of the United States by the same number. Teenagers are said to be those who will largely be affected. However, increasing income to low-income earners will enable them to purchase necessities and kindle the economy. Additionally, families will be out of debt and be in a good position to climb the social ladder.

Several low-income earners are dependents of the government. Low wages make people turn to public aid to make ends meet. Increasing the minimum wage would free resources and create more investments. It is estimated that sixty percent of the working bracket who earn less than seven dollars an hour rely on government assistance or from a family member. If only thirty percent of them receive a pay rise by one dollar and seventeen cents then more than an estimate of one million people will rely less on assistance from the public and will be able to provide for their own needs (David, Manning, & Smith, 2016). The people will, therefore, be satisfied and dignified in buying their food.

There is a belief that upon increasing the minimum wages there will be a rise in job losses. That may not be the case since most workers will tend to join the job market due to higher wages. This gives businesses a chance to choose from well-skilled employees.

Wage raise encourages job stability by reducing employee turnover. Employees who make minimum wages tend to constantly look for better-paying opportunities. This creates a high employee turnover since employees seek better employers who can provide better pay and benefits. Increasing the minimum wage would prevent this since it will provide what they need. According to a National Employment Law Project research, a fast industry experiences a 100% turn over annually because of the low paid employees who leave to seek better opportunities. It also indicates that the cost incurred by the company when an employee leaf is four thousand seven hundred dollars (Karabarbounis, 2018). Increasing minimum wages would, therefore, save a fast company of about 5.2 billion dollars and lower employees' departure by 1.1 million. An analysis by the Centre for American progress indicated that the cost of frequent training and hiring low wage is approximately sixteen percent of annual salary for employees. Increasing the minimum wage will, therefore, reduce the turn over which eventually lowers the turnover cost.

The low productivity in firms, unhealthy workers, poor education and poverty have been attributed to the low wages earned by those working. A journal, APHAs America, on public health reveals that raising the minimum wage would lower premature deaths by 5% for adults in a household of an income of about twenty thousand. Currently, poverty cannot sustain the high health cost thus leading to poor health care. Generally, a rise in the minimum wage will be of great gain to the families since it will boost their living conditions, pay for better health care and get a better education.

Similarly, the increased minimum wage would reduce income inequality. The United States is ranked as one of the top countries experiencing income inequality as per the statistics are given by the Organization for Economic Cooperation and Development (OECD). Low-income earners in America who work full-time make about fifteen thousand dollars annually. This is quite low and indicates that they must rely on welfare programs by the government to sustain them. An increase in the federal minimum wage would provide more money to the earners for spending and saving (David, et al. 2016). It will also raise the figure of those earning a median wage for fair labor. It is true that currently workers are forced to work overtime to sustain their living. If the government sets an increased minimum wage then these inequality gaps will be avoided.

Moreover, an increase in the federal minimum wage would decrease gender and race-based inequality. Women will be slightly affected by the wage raise compared to men since most women constitute the demographics of the number affected by the rise. A slight rise would automatically encourage women's equality. The National Employment Law Project study indicated that 54% of women, 60% of Latino employees and 51% of African workers based in America earn below fifteen dollars an hour. This cuts across all industries including food, accommodation, and childcare. This has created a big gap in ethnic and gender pay. Records given in 2015 indicated that for every fifteen dollars Africans made, twenty-one dollars was made by a white man (Dube, et.al, 2016). Increasing these wages will, therefore, increase the earnings of both the Africans and Latino workers thus bringing them closer to economic security and lower the racial gap created by wealth. It will also enable the less privileged to afford similar opportunities as their white male fellows. Curbing the gender and racial gap may take time but an increased wage rate is a key step in minimizing these gaps.

Conclusion

In conclusion, the minimum wage needs to be raised to accumulate people in the current world. At this generation education, food and medicine are key pillars of living but they remain to be so costly. Even though increasing the minimum wage may not be a total solution to poverty, it is highly considered to reduce poverty levels. It will also encourage most people to get employed since they will feel that the services, they are rendering are fully paid for. This will boost productivity in several organizations due to the creativity and the motivation given to the workers. Technology should also be put into consideration. As it advances people need to invest more in education and work harder. By raising the minimum wage people will be motivated towards education hence leading to better lives.

References

Meer, J., & West, J. (2016). Effects of the minimum wage on employment dynamics. Journal of Human Resources, 51(2), 500-522. Retrieved from https://www.researchgate.net/publication/303122957_Effects_of_the_Minimum_Wage_on_Employment_Dynamics

Karabarbounis, L., Lise, J., & Nath, A. (2018). The Minneapolis Minimum Wage Increase Baseline Report. Retrieved from https://www.minneapolisfed.org ' news events ' bank-updates ' 2018-09

Dube, A., Lester, T. W., & Reich, M. (2016). Minimum wage shocks, employment flows, and labor market frictions. Journal of Labor Economics, 34(3), 663-704. Retrieved from https://irle.berkeley.edu/minimum-wage-shocks-employment-flows-and-labor-market-frictions-wp/

David, H., Manning, A., & Smith, C. L. (2016). The contribution of the minimum wage to US wage inequality over three decades: a reassessment. American Economic Journal: Applied Economics, 8(1), 58-99. Retrieved from https://www.aeaweb.org/articles?id=10.1257/app.20140073