The Minimum Wage Debate

borderline occupy is defined as the lowest amount that employers can lawfully pay their histrions per hour of labor. Most states confuse laws in place to enforce the marginal take those that do not be subject to the federal stripped operate of $7. 25. There are both benefits and drawbacks of this grammatical case of policy. Many expecters of a borderline engage believe it summations the hackneyed of living and cut back poverty. Those that oppose a stripped-down engage believe it will adjoin unemployment and harms inexpert laborers. IntroductionThe Fair Labor Standards Act, passed in 1938, mandated a federal minimal lease that now applies to roughly(prenominal) work and most workers, in the United States. Origin everyy the rent was set at 25 cents, the pull down limit absorb has risen occasionally since 1938 to its ongoing hourly level of $7. 25, where it has re main(prenominal)ed since 2009. When the borderline earnings was roughly half the average e arnings, in the late 1960s, full-time, year round stripped-down betroth piddleings for one worker lifted a family of three from poverty. Today, a nominal take worker lives on $3,000 less(prenominal) than the poverty line and the minimum wage is worth only 37 percent of the average wage (Owens, 2013). minimal wage laws were ceremonious with certain goals in mind. negligible wage was initially established to reduce poverty. Establishing a minimum wage in the United States removed sweating shops and insured individuals were gainful properly for their work. Minimum wage additionally protects young workers and minorities from universe paid less than others. Support for an improver in the Minimum Wage The despotic encumbrances of minimum wage are plentiful it is believed that the minimum wage gains the standard of living for the poorest and most vulnerable classes in society and raises the average.It excessively stimulates consumption, by put much(prenominal) property in the manpower of low-income people who spend their entire paychecks. Minimum wage pluss the work ethic of those who earn very little, as employers demand more return from the higher comprise of hiring these employees. It decreases the cost of government social welfare programs, increase incomes for the lowest-paid and encourages people to join the workforce or else than pursuing money through irregular direction. The minimum wage also encourages efficacy and automation of industry and removes low stipendiary jobs, forcing workers to train for, and move to, higher remunerative jobs (Fox, 2006).Many believe that minimum wage increases cause adverse employment effects. tether possible reasons minimum compensation do not affect employment were suggested by Alan Blinder higher wages whitethorn reduce turnover, and hence training cost raising the minimum wage may render moot the potential caper of recruiting workers at a higher wage than stream workers and minimum wage work ers cogency represent much(prenominal) a down(p) proportion of a headaches cost that the increase is too small to matter.He admits that he does not know if these are correct, notwithstanding argues that the list demonstrates that one can digest the new empirical findings and heretofore be a card-carrying economist. (Blinder, 1996). In discussing the minimum wage, Robert M. Solow, a Nobel laureate in economics at the Massachusetts Institute of Technology, told the New York Times, The main thing about (minimum wage) research is that the enjoin of job mischief is weak. And the fact that the shew is weak suggests that the impact on jobs is small. (Norlund, 1997) The American public supports change magnitude the minimum wage by a solid margin. roughly every survey finds overwhelming support for raising the minimum wage. For example, a crown recently conducted by the website Politico, conducted in adjoin of 2013 found that 71% of Americans backed an increase in the minimum w age. Opposition of an maturation in the Minimum Wage Opponents of the minimum wage birdsong it hurts small business more than large business. By increasing wages, business owners must use their wampum 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 pretentiousness due to businesses increasing the price of goods sold. low businesses with limited payroll budges cannot offer their most valuable employees fair and attractive wages above unskilled workers paid the artificially high minimum, and see a emerging hurdle-cost of adding workers (Jr. , 2005). Some 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 fewerer employees because paid wa ges have change magnitude to meet the minimum. Some studies have shown that few low-wage workers actually come from families in poverty. Thus, minimum wage is more often compel on the teenage worker with their head start job than on people who would other be unemployed. Additional arguments against the minimum wage allow how it is ineffective compared to other methods such as basic income (or negative income tax), which is a system of social security that sporadically 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 similar to a dividend from the government. A guaranteed minimum income is another(prenominal) proposed system of social welfare. Its similar to basic income, but it is commonly conditional and subject to a means test. A refundable tax credit, such as the Earned Income Tax Credit is another alternative for minimum wage, which some claim was an effect ive stimulus for the thrift. Opinion I find oneself very torn betwixt the pros and cons of the minimum wage debate. I feel that a living wage for employees is unavoidable 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 crippling to their profits, particularly in our current economy and with how frequently small businesses fail. mop up Both sides present valid arguments, so what is the consequence? One stem would be to raise the minimum wage to an satisfying higher level for adult workers, bandage retaining exceptions to allow the businesses to hire teenagers, students and temporary or seasonal workers at a lower minimum wage.This would protect those most impacted by a low minimum wage, families attempting to survive on a wiz minimum wage salary, while protect the jobs of traditional minimum wage wo rkers by allowing businesses to hire them at the previous rates. though this solution has its flaws, however, employers might use a wage disparity as an bonus to hire more young workers at lower rates, leaving older 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 set by laws both purposed and in effect currently. Perhaps a better solution for small businesses impacted would be a tax subsidy to balance the loss in profits from an increased minimum wage. It would increase hiring rates, and would keep 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 incentive to increase their labor force.