Minimum Wage Benefits

Higher Minimum Wage; Lower Benefits The national debate over raising minimum wage stems from the need that a raise in minimum wage will provide families with enough money to earn a living wage. A living wage is a wage that provides an individual with sufficient earnings to live above the poverty line. The federal minimum wage was established during the Great Depression and has since risen from 25 cents to what it is currently at $7.25 an hour (Wihbey p.1). The federal minimum wage is the lowest required wage mandated by the federal government. However, different states, counties and cities can also regulate wages and increase minimum wage for employees within their jurisdiction. For example California, Seattle, New York City and Washington …show more content…
Unemployment rates and job opportunities will also largely be affected as minimum wage goes up. One of the biggest current pushes in minimum wage is the setting of minimum wage at $15 dollars an hour. To start this trend many states and cities are leaning into a higher minimum wage at fast food restaurants. This higher minimum wage trend, “however, isn’t cause for worker celebrations,” (Sherk p.4). Although some states and cities across the Unites States have already began adopting a $15 per hour wage, evidence shows that this major increase in minimum wage hurts workers more than it helps them. An increase in minimum wage would affect more workers now than ever before because 1 in 20 Americans are currently making minimum wage (Sherk p.1). The cost of businesses or employers to pay their workers $15 an hour would really be costing them around $18.61 or $38,700 annually due to payroll costs, unemployment insurance, payroll taxes and health care costs (Sherk p.2). These additional increased expenses will result in lower unemployment and it will automatically make many Americans unemployable because they do not have the skills to be worth such a large cost to companies annually. These unskilled and unproductive workers will be out of jobs they would have been hired for all because they are no longer equal to the value that they would be earning at $15 per hour. Following this increase in minimum wage, “the likelihood of unemployment among less educated workers jumped more than eight percentage points,” (Saltsman p.2). To further prove a higher minimum wage results in higher levels of unemployment Congress passed legislation moving minimum wage in American Samoa closer to the federal minimum wage and in two years Samoan unemployment rose from 5 percent to 36 percent (Sherk p.3). There is real case scenarios to support the claim that a higher minimum wage will negatively

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