The Negative Effects of Raising the Minimum Wage

May 23, 2017
By Anonymous

As the economy changes and evolves it is imperative that we, the American people adjust to the needs of the Country. As time passes inflation happens and the value of the dollar changes. Determining the value of the dollar is very complicated and relies on several different factors including, strong economic recovery, falling oil prices, and weakness of the Euro. These factors that create inflation are also the same that determine the price of the minimum wage. Deciding the correct amount minimum wage is very important because if two low then people will struggle to survive but if to high it can create devastating consequences to the economy.


Some people believe the minimum wage should be adjusted to support incomes of full-time adult workers in low-income families, some containing small children. This claim is not supported by the data because most minimum wage workers are young workers, part time, or do not come from poor families. “Roughly half (49.0 percent) are teenagers or young adults aged 24 or under. (62.2 percent) of this group live in families with incomes two or more times the official poverty level, with families from minimum wage workers, averaging almost $70,600.” (Bureau of Labor Statistics.) The minimum wage was created to help children get through and survive through collage, it was never created to sustain a living of minimum wage. “(51 percent) are aged 25 and up. (29.2 percent) live near the poverty level while (46.2 had family income less than 1.5 times the poverty level. Within this half of all minimum wage employees, 24.8 percent voluntarily work part – time, and just 34.3 percent are full-time full year employees.” (Bureau of Labor Statistics) Our country should not base the minimum wages off only 34.3 percent of minimum wage workers.


A minimum wage increase will make businesses change to adapt to the higher wage costs. A main finding of economic theory and empirical research over the past 7 decades have proven that minimum wage increases tend to reduce employment. “The first 25-cent minimum wage in 1938 found that is resulted in job losses for 30,000 to 50,000 workers.” (The U.S Department of Labor’s Assessment) Even implementing the original minimum wage effects the population. American Samoa had terrible results from the minimum wage increases imposed between 2007 and 2009. The effects were so devastating for the island’s economy, when President Obama signed a law scheduling a $0.50 increase, the governor Tulafono testified before Congress. “We are watching our economy burn down. We need to bring the aggressive wage costs decreed by the Federal Government under control.” (Governor Togiola Tulafono)


Increases to the minimum wage has made several fast food restaurants, including Wendy’s to redirect their money towards other things. Wendy’s which is one of the biggest burger chains in the world has announced plans to replace workers with machines because of the enormous wage costs. They plan on doing this by replacing hard working employees with kiosks which are self-service machines. McDonalds also testing the Kiosks which is creating a trend for others to follow. Which restaurant will be next?


Eventually the minimum wage will be forced to rise to meet the needs of the economy, but there is no rush to raise it. The people of our country must ensure to view each situation carefully and understand each outcome. The raising of the minimum wage is not beneficial and will hurt the American people. More people will be in poverty and situations will continue to get worse.





Wilson, Mark. "The Negative Effects of Minimum Wage Laws." Downsizing the Federal Government. Downsizing the Federal Government, 01 Sept. 2012. Web. 19 May 2017.

Sheffield, Hazel. "Wendy's Replacing Workers with Machines Because of Rising Wage Cost." The Independent. Independent Digital News and Media, 18 May 2016. Web. 19 May 2017.

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