One of the biggest debates circulating the United States right now is whether or not raising the minimum wage will have any discernible effect on poverty, particularly those who depend on food stamps.
YES: Minimum wage was last raised in 2009 to $7.25/hour (from $6.55), but hasn’t matched inflation. The gap between the two most basic and essential ways of measuring the cost of living has meant that not only do the poor stay poorer, but there are more bumped into that group. The current minimum wage needs to be around $10-something an hour to match inflation, giving workers in those sectors the ability to reach a baseline of living.
Further, the vast majority of minimum wage employees are over 20 years of age (an average age of 35), with more than a quarter of them having children. If the minimum wage were to be raised, the first positive impact would be seen with families, not with teenagers. This would affect 28 million workers, or almost 10% of the population, and make huge inroads into fixing the poverty problem.
NO: One of the biggest arguments against raising the minimum wage is that big-name companies—the ones who collectively employ the majority of minimum wage employees—will “strike back” to ensure they still get the same percentage of profits. A lateral example of this has been seen with Staples issuing a memo to managers that part-time employees are not to be scheduled for more than 25 hours, as full-time employees (30+ hours/week) are eligible for employer-paid health insurance.
It also wouldn’t solve the problem of job and product growth, as employees need to produce more to merit the increased wages, companies must earn more than they spend, and raising the minimum wage would cause companies to turn to fewer, higher-skilled employees.
Lastly, raising the minimum wage doesn’t address the economic problem of career—not job—growth in the United States. Simplifying it greatly, the middle class has been eroded by padding the upper class (causing them to shrink at the same time) and increasing the gulf between poor and rich. The problems are far more complex, of course, but paying people middle-class wages for lower-class jobs is akin to paying someone a surgeon’s salary to give flu shots. The work just doesn’t merit the salary.
COMPROMISE: Solving the minimum wage debate so that as many people on both sides as possible are satisfied is neither a simple issue nor something that will happen quickly. Adding complexity to the problem is the United States has just such a large population, ensuring each and every citizen is well taken care of is a near-impossibility. But one possible solution is for any president to enact bills and laws with teeth such that large corporations have to divest at least some energy into the maintenance of their employees. Another is to look to the future and see what kind of jobs can be secured in America: manufacturing has clearly gone to the East, and so “thinking” jobs can replace that, and create the middle-class that was lost after the auto boom.
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