Minimum Wage Argumentative Essay PDF

Preview

Summary

Sample essay on minimum wage debate...

Description

Hallett 1 Kayden Hallett Engl 102 Professor Hobstrach 13 March 2020 Minimum Wage Increase Hurts the Poor Standing on top of a stage addressing thousands of Americans stands the honored Politician. With his plan to increase minimum wage the crowd erupts in cheers, but a minimum wage increase comes with a hidden cost unknown to the cheering masses. An increase in the minimum wage is sold as a method to assist those who are below the poverty line, however, it often does more harm to the impoverished than they expected. Minimum wage should not be increased due to its minimal effect on poverty levels, the high unemployment rate for uneducated workers, and risk the closure of small businesses. A minimum wage increase will raise unemployment rates. Labor is already one of the most expensive costs of production. As labor costs rise output will become more costly. To meet the rising costs, businesses will utilize the most skilled and efficient workers or technology. Quart's Article “Seattle’s minimum-wage increase made the most vulnerable workers poorer” was published shortly after economics analyzed Seattle’s newest policy to discover it was not as successful as citizens hoped. Author, Allison Schrager states “It resulted in low-wage employees working 3.5 million fewer hours per quarter and in 5,000 fewer jobs. Low-wage employees ended up being paid $120 million less a year” (Schrager). With increased unemployment due to fewer jobs, whatever jobs are available will become more competitive and businesses will hire the most skilled and experienced workers possible. In entry-level positions work that could once

Hallett 2 be done by any worker is now being done by more experienced, and traditionally higher-paid, employees. This suggests that a wage increase caused the most harm to unskilled workers with minimal experience. As wages increase and jobs become more competitive these workers will continue to be unemployed, struggling more than they were before. Minimum wage increases will work to deprive the working poor of job opportunities. Among these are minority groups who have suffered major societal hindrances such as immigrants with poor language skills, high school dropouts and the disabled. By increasing unemployment, a minimum wage increase may take jobs away from the less privileged instead of giving them additional benefits to meet equality. Secondly, minimum wage increases have a minimal effect on the poverty level. Minimum wage increases are sold as a way to get people out of poverty. However, the poverty level is dependent on the job market, not the minimum wage. It is simple to say that putting people to work generally reduces the poverty level. The more people work, the less they are dependent on government assistance. Their once needed assistance can benefit an additional person or family in need. However, as mentioned in the last paragraph, minimum wage increases may reduce the number of available jobs. Since unemployment raises, more people will be reliant on government assistance to meet the standard of living. The Foundation for Economic Excellence states “The African-American poverty rate declined from 34.7 percent in 1968 to 21.4 percent in 2016. For whites, it declined from 10 percent to 8.8 percent in the same period. The main contributing factor to this decline is economic growth and the availability of jobs, not a higher minimum wage” (Boyce). It is also important to understand the demographics of people living in poverty. According to The Heritage Foundation ``Over three-fifths of individuals living below the poverty

Hallett 3 line did not work, and only 11 percent worked full-time year-round” (Sherk). If the majority of those in poverty are not working, a wage increase would not help them. Although the minimum wage increase is said to help the poor, it will only make those unemployed worse off and more impoverished. America’s history has proved that the best way to get people out of poverty has been proven to be through jobs, not an increase in the minimum wage. A wage increase would increase inequality between America’s class system, not benefit the poor. Next, minimum wage risks the closure of small businesses. The American dream is all about small business. By threatening the closure of our nation's backbone, the American economy is heavily threatened. With higher output costs it becomes more expensive for smaller companies to operate due to the inability to pay workers a higher wage. Forbes explains this by saying, “Unlike larger businesses, smaller businesses usually operate in a highly competitive environment with thin margins. Competition makes it difficult to pass on minimum wage hikes to consumers' (Mordoukoutas). Big-name stores like Target and Walmart can sell similar products for a smaller cost and can afford financial losses. Small businesses usually operate by sacrificing small profits and owners taking low salaries. Higher operating costs will make it nearly impossible for some small businesses to operate. The Gotham Gazette explains that “A small increase of $1.60 per hour would cost a bakeshop with ten clerks and bakers over $30,000 per year” (Gotham Gazette). The extra cost in output would have to be met by firing workers or an increase in product prices. Small businesses provide opportunities for Americans to work, fulfill entrepreneurial and creative aspirations while benefiting the economy. A minimum wage increase would threaten the closure of the small businesses that have benefited Americans for generations.

Hallett 4 The other side of the argument states that a minimum wage increase is crucial for low-wage workers to share the benefits of economic growth. Minimum wage workers are mostly minority groups such as women and people of color who have endured generations of oppression, leading to unfair financial disadvantages. Before labor laws were set in place, women were unable to pursue a well-paying career or unable to make money for themselves due to having to take care of children. Discrimination against minorities in the workplace has consistently lead to their position below the poverty line. As the national standard of living keeps rising, the minimum wage must get increased for Americans to afford necessary costs like rent or food. The Economic Policy Institute states “Workers today who are paid the federal minimum wage of $7.25 an hour are, after adjusting for inflation, paid 29 percent less than their counterparts 50 years ago. Had the minimum wage kept pace with labor productivity growth since 1968, this year it would be more than $20 per hour” (Zipperer). As inflation increases, wages should increase alongside it. Americans are overdue for a minimum wage increase. It shouldn't be impossible for a single parent to raise a child on a minimum wage salary. By increasing the minimum wage slowly it will help ameliorate some negative side effects. Although this is accurate in some cases, it is important to note that the minimum wage increase best influences those who already employed, not those looking for a job. Parents are poor because of the lack of a full-time job, not low wages. According to The Heritage Foundation, “ If at least one parent in every poor household worked full-time year-round, the child poverty rate in the United States would plummet by 72 percent” (Sherk). Arguers both for and against the minimum wage debate agree that America has a poverty problem that needs to be addressed. The poor are at an unfair advantage and need additional financial compensation,

Hallett 5 however, raising the minimum wage does not address the problem instead may make the impoverished struggle more. I propose to improve the welfare system to favor those working instead of giving financial compensation to those who choose not to work. Americans who rely on financial assistance from the government to live have no desire to work. By making a system that stresses the importance of work and gives additional financial compensation to those who do work, America would be able to get those in poverty to work. Getting more people to work and increasing jobs is the best way to help America’s poverty problem, not reducing jobs by a minimum wage increase. Oftentimes the poor are misled into supporting a minimum wage increase that only works against them. A minimum wage increase will create an imbalance in the economy while worsening the inequality issue Americans face. Despite income equality needing to be met, the needs of the working class will not be reached by a minimum wage increase.

Hallett 6

Works Cited Alesse, Mark, and Matthew Guilbault. “A Minimum Wage Increase Will Hurt Small Business and the Working Poor.” Gotham Gazette, www.gothamgazette.com/index.php/about/2313-a-minimum-wage-increase-will-hurt-sm all-business-and-the-working-poor. Boyce, Paul. “Why the Minimum Wage Can't Solve the Poverty Problem: Paul Boyce.” FEE Freeman Article, Foundation for Economic Education, 5 July 2019, fee.org/articles/why-the-minimum-wage-can-t-solve-the-poverty-problem/. Mourdoukoutas, Panos. “Federal Minimum Wage Hikes Could Crush Small Businesses Across America.” Forbes, Forbes Magazine, 18 July 2019, www.forbes.com/sites/panosmourdoukoutas/2019/07/17/federal-minimum-wage-hikes-co uld-crush-small-businesses-across-america/#52a22bcd6eb1. Schrager, Allison. “Seattle's Minimum-Wage Increase Made the Most Vulnerable Workers Poorer.” Quartz, Quartz, 27 June 2017, qz.com/1014759/seattles-minimum-wage-increase-made-the-most-vulnerable-workers-po orer/.

Sherk, James. “Raising the Minimum Wage Will Not Reduce Poverty.” The Heritage Foundation, www.heritage.org/jobs-and-labor/report/raising-the-minimum-wage-will-not-reduce-pove rty .

Hallett 7 Zipperer, Ben. “Gradually Raising the Minimum Wage to $15 Would Be Good for Workers, Good for Businesses, and Good for the Economy: Testimony before the U.S. House of Representatives Committee on Education and Labor.” Economic Policy Institute, 7 Feb. 2019, www.epi.org/publication/minimum-wage-testimony-feb-2019/....