List of Pros and Cons of a Minimum Wage Increase
The topic of minimum wage, the cost of minimum wage and should minimum wages be raised has long since been a topic of debate, both in the general public and in the governmental body. Of course, we would all like to have more money in our paychecks come Friday morning, but what would it do the economy? What would the raise of minimum wage do to the economy as a whole and would it really help to relieve the pressure that the economic downfall has put us into? In this following article, we will discuss some of the pros and cons of the minimum wage cost and raise of this amount, and let you be the judge as to the final outcome.
The Pros of a Minimum Wage Increase
1. The Economic Stimulus.
Minimum wage has long been a minimum standard of living. This is what the government has decided a person needs to make per hour (at a full time or part time job) to be fairly compensated for their work and still maintain a living. Raising minimum wage would generally mean that those who work for these wages would have more money to spend into small businesses, businesses in general and that putting their money back into the community would help the economic downfall.
2. Job Opportunities.
If minimum wage is raised, that means that people are able to spend more money. This in turn causes businesses to have more clients, customers and sell more products. If a business gets a jump start into more sales, they may find that they need more employees and this produces job opportunities.
3. Employee Satisfaction.
Minimum wage earners who do get a small raise here and there (or even a raise for the cost of living in general) often are happier working with the small raise than starting out at a higher salary. This means that workers are less likely to look for a new job, make pay demands, or quit outright.
4. Financial Security.
With the rising cost of living, those who get a minimum wage increase are more likely to get a feeling of financial security (at least to some degree). While making a dollar more an hour may not sound like much to many of us, for someone who is tight on finances that forty dollars a week can really add up.
The Cons of a Minimum Wage Increase
1. Employee Layoffs.
If employers find that a wage increase for all their employees if going to financially hurt the company until it can adjust or permanently, employers are more likely to give temporary or permanent layoffs. While some employees may see the benefits of a wage increase, others may be faced with no job and struggling to find a new one.
2. Economic Price Increases.
Retailers may find that they will raise prices on their services and products with a wage increase. The reason for this is that they may be raising prices to cover the cost of paying employees. This could cause companies to face financial distress, or possible face closing down if they find that paying their employees is not going to be financially available anymore.
3. Less Hiring.
If a company can barely afford to pay their employees based on a higher wage increase, chances are they wont be hiring. Many companies may start looking to outsource, which means hiring people from other countries to do the same work for a different cost that is customary in their country.
4. Less Incentives and Cash Flow.
What we mean by this is that if wages are risen too much, employers may find it hard to offer sign on incentives, Christmas bonuses or extra commission for projects well done. While many may still try to find ways of offering these to their employees, there will certainly be many more who may not be able to financially make that possible.
What Does it All Mean?
Other concerns that people have are numerous. Will they get taxed more if they get a pay increase? Will they get as much back in their taxes at the end of the year if more is taken out? How will a pay increase affect other costs that they have (such as qualifying for low cost health care or other assistance)?
Some people also feel that a minimum wage increase is unnecessary for some people. While we do need to appreciate that there will always be low wage earners in jobs that seem less than desirable (for example, a burger person in a fast food restaurant), we do need to also consider other factors. Who is actually working hard and who is just looking for a hand out? Many people feel it is unfair to give a wage increase to someone who does not work hard and who complains at work all the time. Others feel that those who tend to live off the system and scream for handouts will be the ones who benefit more from a wage increase since more comes out of your taxes.
The battle regarding the minimum wage amount and the increases that people feel are needed will forever be a topic for discussion. While everyone has a good point or a valid reasoning for how they feel, it is ultimately up to the government to determine how much we really are going to afford. Of course, people do dictate a lot of that as well, and with a good solid hand in hand movement, we can figure out a good way of a steady wage.