Minimum Wage in the USA is Too Low

Published: 2021-09-12 09:15:10
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Category: Economy, United States

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Money, as of now, is just a small slip of paper. Yet such small and crinkled papers hold so much significance in America and its people. However, the issue of not having enough money, whatever it’s form, is a timeless one. Even in complex societies today, not having enough money for basic necessities is still an issue. During the 1960s to the 1980s, one full minimum wage job could keep a family of two from falling into the poverty line (Board, 2014). The concept of a Minimum Wage can be seen as a safety net to fall back on as a wage is guaranteed to help one afford the basic necessities. This is not the case today. The Minimum wage is too low to sustain anyone in America, and needs a raise.
However, there are those who disagree with the Minimum Wage needing an increase. An argument generally made by Conservatives is that higher minimum wages will hurt businesses (Board, 2014). Businesses hurt by a minimum wage increase will result in jobs being cut off, which is counterintuitive to what the point of raising the minimum wage is. (Board, 2014). It is also argued that raising the minimum wage will also cause prices to increase, which will hurt consumers along with those who barely able to afford basic necessities. (Board, 2014). In short, the argument against raising the minimum wage is that raising it will cause problems which will affect those whom it’s supposed to be benefiting (Board, 2014). While the other side does have points to argue in opposition of raising the minimum wage, there are also many factors as to why the minimum wage should, and needs to be raised. The minimum wage should be raised because when low end wages increase, poverty and economic inequality get reduced (Board, 2014). Decades of research has proven that increasing the minimum wage will bolster economic security of many American workers, as it will also prove beneficial for a weak economy should there be another recession (Board, 2014). An increase will have positive effects that will benefit workers and those who are paid more than them (Lopresti & Mumford, 2016). While raising the minimum wage could cause an increase in automation and higher sales prices with less sales volume, it will have a small effect on the economy as consumer power will be amplified (Greenhouse, 2016). This has no negative effects on working hours does and does not lead to reductions in employment (Ingraham, 2017). It has also been proven that there is little evidence of severe disemployment effects from raising the minimum wage among low skilled and young workers in specific (Sturn, 2018). Not raising the minimum wage will only continue and increase dependence on food stamps, as this also results in lower wages as employers who pay low amounts will need to use Government assistance for their workers (Board, 2014).
Negative effects of raising the wage only come into play when employers setting low wage growth into their system which benefits no one in the long run (Lopresti & Mumford, 2016). The current minimum wage is too low for today’s time, as it is currently 7.25 dollars and has not changed since 2009 (Ingraham, 2017). This is not enough to afford the basic necessities in this country as the cost of living demands more than what can be earned from today’s minimum wage of 7.25 dollars. Progress has been made throughout the years, but the fight still continues. Raising the minimum wage does come with great benefits. Where trickle down economics failed, raising the minimum wage can accomplish what was sought by the former.
The minimum wage was first introduced in 1938 by The New Deal Legislation (Board, 2014), it was during a time of crisis in America known as The Great Depression. Today, minimum wage workers are having to cope with an unevolving Minimum wage as they are still living in poor conditions similar to those of The Great Depression from decades past. The average age among minimum wage workers is 35, and most of them are full time workers (Board, 2014). More than a quarter of them are parents, and earn half of their families’ total income (Board, 2014). Should the minimum wage have had started to increase from $7.25 in 2014 to $10.10 by 2016, it would have benefited 27.8 Million workers in America (Board, 2014). More than 50 Million of them obviously earn less than $15 an hour (Greenhouse, 2016). Should the minimum wage have had increased from $7.25 to $10.10, at that time, it would’ve reduced the number of people who are under the poverty line by 4.6 million (Board, 2014). This is obviously not the case today.
Today, a low minimum wage is also tied with exorbitant living costs. Disneyland Resort, located in Anaheim, California, employs nearly 30,000 people (Medina, 2018). As reported in February 28, 2018, among the 17,000 workers who are part of a union, 14,450 among them make less than $15 an hour, which makes up about 48% of workers at Disneyland Resort. (Medina, 2018). Despite working between 20 to 40 hours a week for $11 an hour, about 38% of Orange County’s 1.5 million workers are earning less (Medina, 2018). Despite California’s minimum wage being at $10.50 an hour, a worker living in Orange county would need to make $33,000 annually, which would at minimum, would be $15.87 an hour, to afford basic necessities (Medina, 2016).
Not only does California has the highest poverty rate in the nation, which is 20.6% (Medina, 2016), it is also ranked Third in the nation for Highest housing costs (Jan, 2018). It would require a $32.68 hourly wage to afford a two bedroom rental house without having to pay more than 30% of one’s income (Jan, 2018). This comes just under Hawaii and The District of Columbia (Jan, 2018). In Hawaii, which has a $10.10 minimum wage, one would need to make $75,000 a year, which is $36.13 an hour to afford a two bedroom apartment (Jan, 2018). The state which scored the lowest, Arkansas, which has a minimum wage of $8.50, one would need a pay grade of $13.84 an hour to afford a two bedroom house, which equals up to $29,000 annual (Jan, 2018). Such high living costs and low wages make aforementioned Orange County workers to be homeless, to sleep in their company’s parking lot, and having to use food stamps (Medina, 2018).
This issue is still a developing one. Protestors have been motivated to support the Fight For $15’s movement, as the movement has spread from one city to throughout the country in 150 cities as reported in 2016 (Greenhouse, 2016). Governor Jerry Brown of California announced back in 2016 that a deal was made with state lawmakers to raise the minimum wage to $15 by 2022 in California (Greenhouse, 2016). New York Governor Andrew M. Cuomo also reached a deal to raise their minimum wage to $15 throughout 2018 and 2021 (Greenhouse, 2016). In Maine, workers will gain a dollar increase from $9 to $10 (Greenhouse, 2016), which ranks 23rd on the list of States Ranked by Two Bedroom Housing Wage (Jan, 2018). Washington state will increase theirs to $11.50 an hour, while Colorado and Hawaii will add on 90 and 85 cents respectively (Greenhouse, 2016). These are steps in the right direction as it will help millions of workers but the issue of their housing still remains. However, fast forwarding to 2018, the Trump Administration has attempted to cutting Housing Subsidies for low income citizens, as now only 25% of households receive Federal aid (Jan, 2018). It was also proposed by the current Secretary of Housing and Urban Development Ben Carson to triple rent for low income households (Jan, 2018). While progress is being made in some select states, the sentiment held and actions taken by the currently governing Trump Administration do not benefit low income workers. Compared to the rest of the Organisation for Economic Co-operation and Development, or for short, the OECD, America ranks the lowest among them in the category of national median wage (Ingraham, 2017). The $7.25 Federal Minimum wage in America makes its national median wage 35% , giving America it’s low rating (Ingraham, 2017). Meanwhile, Canada has a national minimum wage that equals 46%, Australia’s is 54%, and in France it’s 61% (Ingraham, 2017).
America has fallen far behind the rest of the world in terms of how it takes core of and supports it’s workers. The current administration, the Trump Administration, has shown little care of helping (Jan, 2018). Raising the minimum wage is an important step in protecting and supporting American workers. While there is an opposition with their own points there are many benefits to raising it. Doing so will not only benefit low wage workers, but the benefits will also help workers who are paid higher than them (Lopresti & Mumford, 2016). Dependence on food stamps, which takes money away from the company to pay workers to get aid, will also be reduced (Board, 2014). Consumer power will increase (Greenhouse, 2016), while unemployment will decrease (Ingraham, 2017). A country only becomes strong through it’s workers.

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