The Minimum Wage Debate

marginal net is defined as the net amount that employers can legally pay their proletarians per hour of labor. Most states throw laws in place to enforce the lower limit engross those that do non atomic number 18 subject to the federal nominal enlist of $7. 25. There are both benefits and drawbacks of this type of policy. Many supporters of a stripped wage mean it increases the standard of support and reduced poverty. Those that oppose a borderline wage believe it will increase unemployment and harms un skilled laborers. IntroductionThe Fair churn Standards Act, passed in 1938, mandated a federal lower limit wage that now applies to intimately work and most workers, in the United States. Originally the wage was solidifying at 25 cents, the stripped-down wage has risen occasionally since 1938 to its current hourly direct of $7. 25, where it has remained since 2009. When the minimum wage was roughly half the average out wage, in the late 1960s, full-time, year rou nd minimum wage win for one worker lifted a family of three from poverty. Today, a minimum wage worker lives on $3,000 less than the poverty line and the minimum wage is worth only 37 percent of the average wage (Owens, 2013).Minimum wage laws were established with certain goals in mind. Minimum wage was initially established to reduce poverty. Establishing a minimum wage in the United States re meltd sweat shops and insured individuals were paid properly for their work. Minimum wage additionally protects younger workers and minorities from being paid less than others. represent for an Increase in the Minimum Wage The positive effects of minimum wage are plentiful it is believed that the minimum wage increases the standard of living for the poorest and most vulnerable classes in society and raises the average.It in like manner stimulates consumption, by position more money in the hands of low-income people who spend their ideal paychecks. Minimum wage increases the work ethic of those who earn very little, as employers demand more return from the higher apostrophize of hiring these employees. It decreases the cost of government activity social welfare programs, increasing incomes for the lowest-paid and encourages people to join the workforce preferably than pursuing money through illegal center. The minimum wage also encourages efficiency and automation of industry and removes low paying jobs, forcing workers to train for, and move to, higher paying jobs (Fox, 2006).Many believe that minimum wage increases have got adverse employment effects. Three possible reasons minimum return do not affect employment were suggested by Alan Blinder higher reinforcement may reduce turnover, and hence training costs raising the minimum wage may render moot the potential problem of recruiting workers at a higher wage than current workers and minimum wage workers index represent such a humiliated proportion of a melodic phrases cost that the increase is too sma ll to matter.He admits that he does not screw if these are correct, but argues that the list demonstrates that one can accept the new-made empirical findings and still be a card-carrying economist. (Blinder, 1996). In discussing the minimum wage, Robert M. Solow, a Nobel laureate in economics at the Massach habittts Institute of Technology, told the spic-and-span York Times, The main thing about (minimum wage) research is that the evidence of job deviation is weak. And the fact that the evidence is weak suggests that the impact on jobs is small. (Norlund, 1997) The American humanity supports increasing the minimum wage by a solid margin. close to every survey finds overwhelming support for raising the minimum wage. For example, a poll recently conducted by the website Politico, conducted in March of 2013 found that 71% of Americans backed an increase in the minimum wage. Opposition of an Increase in the Minimum Wage Opponents of the minimum wage claim it hurts small business more than large business. By increasing reinforcement, business owners must use their profits to increase wages or increase their prices. Cheaper labor helps small businesses employ younger and more inexperienced workers to perform less skill intensive work.Its also argued that it may cause price largeness due to businesses increasing the price of goods sold. Small businesses with limited payroll budges cannot spin their most valuable employees fair and attractive wages above unlearned workers paid the artificially high minimum, and see a rising hurdle-cost of adding workers (Jr. , 2005). few opponents claim that the goals minimum wage was created to accomplish have not been met. In some instances employment has decreased more than the increase in wages and thereby overall earnings are still reduced.Businesses are forced to hire fewer employees because paid wages have change magnitude to satiate the minimum. Some studies have shown that few low-wage workers actually come fro m families in poverty. Thus, minimum wage is more often imposed on the teenage worker with their first job than on people who would otherwise be unemployed. additive arguments against the minimum wage include how it is ineffective compared to other methods such as basic income (or negative income tax), which is a system of social security that periodically provides each citizen with a sum of money that is sufficient to live on.This does not include a means test, the richest and the poorest would receive it as something like to a dividend from the government. A guaranteed minimum income is another proposed system of social welfare. Its similar to basic income, but it is normally conditional and subject to a means test. A refundable tax credit, such as the Earned Income Tax honorable mention is another alternative for minimum wage, which some claim was an effective remark for the economy. Opinion I feel very torn between the pros and cons of the minimum wage debate. I feel that a living wage for employees is demand to ensure that poverty levels are avoided.In addition to avoiding poverty, fair wages for all is essential to reducing wage discrimination. However, I find that the increased wage paid to employees by small businesses can be incapacitating to their profits, particularly in our current economy and with how frequently small businesses fail. proof Both sides present valid arguments, so what is the event? One settlement would be to raise the minimum wage to an acceptable higher level for adult workers, while retaining exceptions to allow the businesses to hire teenagers, students and temporary or seasonal worker workers at a lower minimum wage.This would protect those most impacted by a low minimum wage, families attempting to survive on a single minimum wage salary, while protecting the jobs of traditional minimum wage workers by allowing businesses to hire them at the previous rates. Though this resolvent has its flaws, however, employers mig ht use a wage disparity as an bonus to hire more young workers at lower rates, leaving sr. workers jobless. This solution and others are highly debated by politicians and citizens and truly, no solution has been found.In time, the federal minimum wage will rise, as is dictated by laws both purposed and in effect currently. Perhaps a better solution for small businesses impacted would be a tax subsidy to equaliser the loss in profits from an increased minimum wage. It would increase hiring rates, and would bear small businesses at their previous profit levels. Employment would increase in a sector, small business, which our economy greatly relies on and provide those companies with fillip to increase their labor force.