Minimum Wage Analysis

Higher wage hurts the people it is meant to help the most, including the ones in poverty and low working class. Many of the uneducated will be competed out of jobs making it harder than it already is to get a job. In “Researchers Probe Pros and Cons Of Seattle’s $15 Minimum Wage” Wang reveals, “The weight of evidence suggests that moderate minimum wage increases have insignificant to non-existing negative effects on employment… reduce worker turnover and worker retention, and result in small, one-time price increases in heavily-affected industries, such as restaurants” (Wang 1). Wang analyzes how rising wage will not affect the employment of workers. In fact, Wang believes it will reduce turnover and worker retention. Annie Lowrey, author of
Lowrey, author of “Minimum Wage Increase Would have Mixed Effects”, reports effects of raising minimum wage. Lowrey claims, “...it would also lift 900,000 families out of poverty” (Lowrey 1). A few other reporters claim the same scenario, such as Amadeo from “How Much do you need to live?” Claims the same statistics of how 900,000 families will rise out of poverty and increase the incomes of workers. Also, consumers are predicted to purchase more. Another benefit is the increase in consumer purchasing from the citizens. “National Poll” states, “Small business owners believe that a higher minimum wage would increase consumer purchasing power. 56% say raising the minimum wage would help the economy” (1). With the increase, there would be more money to spend on restaurants and businesses. Increasing local economy and pushing economic flow. Not only does more money get circulated into the economy, but “Effects of Minimum Wage” predicts, “Real income would increase, on net, by $5 billion for families whose income will be below the poverty threshold under current law, boosting their average family income by about 3 percent.” (1). Minimum wage of $10.10 would increase real income by $5 billion, giving back to workers below poverty. The $10.10 wage allows workers to have more spending money while boosting the local economy. With the addition of the
The most dramatic change takes place from 2007 to 2009 when the minimum wage went from $5.85 to $7.25. The graph demonstrates Perry’s and Syrios’s claims of increases in unemployment rate as wages rise. Perry also writes:
A higher minimum wage has the biggest impact on those with the least experience or the fewest skills. That means in particular those looking for entry-level jobs, especially teenagers. And sure enough, as nearly all economic models predict, the higher minimum has wreaked havoc with teenage job seekers, well beyond what you would expect even in a recession. (1)
Perry agrees the increase in wages will harm most of the low skilled workers. One can expect further increases in teenage joblessness, which can have long-term consequences that might adversely affect teenagers throughout their lifetimes. Here is how Perry explains that possibility:
Most readers remember the work habits they learned from their first job. Showing up on time, being courteous to customers, learning how to use technology—such habits are often more valuable than the actual paycheck. Studies have confirmed that when teens work during summer months or after school they have higher lifetime earnings than those who don’t work. So raising the minimum wage may inadvertently reduce lifetime earnings.