Increasing Minimum Wage

Written By Patrick Fritz 

Recently President Barack Obama proposed the idea of increase minimum wage from $7.25 an hour to $9.00 in stages by the end of 2015. It would also rise to the inflation rate if it were to increase. This bill according to Obama would allow consumer spending to pick up a little, and help the economy. If this bill were put into place it would help and estimated 15 million workers who have minimum wage jobs. Raising minimum wage would also have big effect on students that are working to pay off college. If this were to be approved it would help out thousands of students help pay for their college tuition, which is extremely expensive. People with lower income jobs would increase the yearly income to $18,720 for a full-time minimum wage worker. Even with an increase it would still leave a family of four short of the poverty level of $23,050 a year.

I feel that this bill needs to be passed as it would not only help the lower income workers, but it would also help boost the economy and increase consumer spending. Economists at the Chicago Federal Reserve estimated that a $1 increase in the minimum wage would raise consumer spending of low income families by an average of nearly $5,000 a year. This is one way that it could help boost the economy as it would add an estimated 70 billion dollars in consumer spending. If people have a little extra money they would be more willing to spend it which would help the economy. Barack Obama said, “It could mean the difference between groceries or the food bank, rent or eviction, scraping by or finally getting ahead. For businesses across the country, it would mean customers with more money in their pockets…” This is a perfect quote to describe the positives of increasing the minimum wage.

Although I believe that increasing minimum wage should be increased there are some facts that support the people who don’t want it to increase. One major issue that comes up is the fact that it could increase the unemployment rate. The reason this is thought to happen is that many companies who are based on minimum wage workers such as Pick n Save or Wal-Mart won’t want to have to pay all their workers more money. So in order to keep the profits from going down they will not hire as many people and let some people go.

Despite a few cons that come with increasing the minimum wage, the immense amount of pros is something that can’t be passed up. This bill would help out the economy and give hard, deserving workers a bit of a raise to make their life a little easier. Students would also be personally affected by this because the majority is working minimum wage jobs to pay off college tuition. Also because of inflation the minimum wage has lost some ground that peaked at $10.41 in 1968. If the minimum wage was ties to inflation since then the minimum wage would now be at $16.50 an hour. This is shows how little some workers are getting paid and why the 15 million people who are receiving minimum wage deserve a raise.

Sources:

• "Obama Pushes for Increase in Federal Minimum Wage - NYTimes.com." The New York Times - Breaking News, World News & Multimedia. N.p., n.d. Web. 19 Apr. 2013. <http://www.nytimes.com/2013/02/13/us/politics/obama-pushes-for-increase-in-federal-minimum-wage.html?_r=0>.
• "Obama's latest stimulus plan: raise the minimum wage - Economy Watch on NBCNews.com." Breaking News & Top Stories - World News, US & Local | NBC News. N.p., n.d. Web. 17 Apr. 2013. <http://www.nbcnews.com/business/economywatch/obamas-latest-stimulus-plan-raise-minimum-wage-1C8350755>.
• "Stand with President Obama: Raise the Minimum Wage | LeftAction." Home | LeftAction. N.p., n.d. Web. 19 Apr. 2013. <http://leftaction.com/action/raise-minimum-wage>.
• "Obama proposes $9/hour minimum wage. OK, says business owner. - CSMonitor.com." The Christian Science Monitor - CSMonitor.com. N.p., n.d. Web. 19 Apr. 2013. <http://www.csmonitor.com/Business/new-economy/2013/0213/Obama-proposes-9-hour-minimum-wage.-OK-says-business-owner.>.