unemployment, and has benefits in terms of reducing income inequality and would increase job growth.
Some drawbacks of minimum wage: Although minimum wage can help certain families and individuals earn a good amount of income to satisfy their needs and their living, minimum wage puts the chance of a teenager and an older person getting a job equal because they both have different jobs, skills and needs but they are both getting paid the same. If there were no minimum wage, a teenager would get paid less than an older person. Minimum wage is positively correlated with teenage unemployment because people always assume "a bad job is better than no job" and that is where everyone starts. The minimum wage creates an oversupply of laborers for an employer to choose from. The amount of teenagers unemployed has increased since 1948. Minimum wage is very difficult to live on and to live in ease and results in negative consequences for all. Another disadvantage of minimum wage increase is it would raise taxes and decrease employee benefits. Because employees are getting paid more, they no longer have benefits they used to receive such as healthcare insurance and retirement plans. They also have to pay more in payroll taxes and income taxes. Citizens will lose benefits such as food stamp benefits, and child care subsidies. Although employees will be getting paid more, technically they will be getting paid less because of all the benefits lost and all the extra taxes needed to be payed.
Some benefits of minimum wage are: Minimum wage reduces the income inequality because a decrease in minimum wage was one of the biggest causes of inequality in American in 2015, and a Senior fellow in economic studies at the Brookings institution said that raising the minimum wage would decrease inequality because there is a gap between middle-wages workers and lower-waged workers. If the minimum wage were lower, lower-waged workers would earn less as many jobs in the United States rely on minimum wage. Sometimes people don't have enough to take care of their families with minimum wage. Another aspect of inequality that increasing minimum wage would help is racial and gender inequality. Many of women work based on minimum wage and African Americans and Hispanics make 67% and 79% respectively, and increasing the minimum wage would ensure a more equal distribution among different race and gender groups. With lower minimum wage, women and people of color are being paid less which is causing men to be paid more, causing an uneven mean distribution. Minimum wage also causes poverty in families and an increase in minimum wage would make less families poor. Teenagers living in poverty are less likely to miss school and get better grades because teenagers living in poverty are more likely to miss school. Increasing the minimum wage will also give better pay to working teenagers for less hours which will allow them to focus on their studies and get better grades.
In conclusion, minimum wage has many benefits such as reducing income inequality and drawbacks such as raising taxes. Minimum wage is a very huge debatable issue today that can still not be resolved because there are so many advantages and disadvantages of minimum wage.