Watching documentaries such as "Waging a Living" and looking at statistics such as the one above can be heartbreaking. Watching the "working poor" do overtime while trying to make ends meet for their families and selves should make you want to cry out for the unfairness of it all. Throughout the documentary, all these minimum wage workers wanted was an increased wage so they could keep up with the actual living wage in the areas where they lived. They celebrated when unions received a 25 cent raise, and said over and over again how much easier their lives would be if their minimum wage was increased to match the actual living wage.
I don't think these low-income workers were lazy, or stupid, or below me in any way, shape or form, but I'm also not sure if they're entitled to increased wages across the board. Hard work should lead to raises, yes, the American dream teaches us that. But if the bottom-rung pay scale was legally raised, I'm not sure raising the minimum wage wouldn't be a very terrible idea.
Please understand, I am a mass communication student. I don't follow economical strategies closely, and haven't worked for minimum wage since I was 16. Chances are that my opinions are hugely wrong and I'm missing a large part of the equation. But when I look at statistics that come with minimum wage, I can't help but think there must be another, more productive way to help than just by paying everyone more.
In a free market, demand is always a function of price. The higher the price, the lower the demand. This rule applies to both prices and wages. When employers evaluate their labor and capital needs, cost is a primary factor. If the cost of hiring low-skilled workers rises with minimum wage requirements, jobs will be lost, and the company will find ways to replace them. I can compare this to when my hot water heater started leaking. There me and my roommates were, ankle deep in water, working with our apartment repairmen to call around and find the cheapest handyman we could. Once we found that everyone's rates were too high, they all lost our business. Our apartment repairman a grabbed a wrench, plugged up a hole, replaced a wire, and prayed to God that would fix the leak. Had the minimum rate been lower, one of those handymen in the phone book would have made a profit. Instead, while they had the potential to make more, they all ended up losing the job.
Another angle to consider, doesn't an employee need to know that an employee's productivity will exceed the cost of hiring and paying them? If an unskilled worker only gives, let's say, $6 an hour in productivity, the company will hire them if their pay is less than $6 an hour, but if minimum wage is set at $7 an hour, the company would not be able to hire that person, so they would be legally unemployable if minimum wage increased. Jobs would only remain available to skilled workers capable of more productive output.
Where does that put low-skilled workers, such as teens and uneducated workers? Priced out of the market. That's why there aren't any more jobs such as movie ushers or bag boys that carry your groceries to your car. Employers can't make a profit off of them if they have to pay higher wages, so those people's jobs are cut out of the system thanks to minimum wage raises. They can't achieve their American dream by working hard to earn a decent life if they can't even start on the bottom rungs of the ladder to success. This makes sense: If all low-wage employees are pooled into a single wage bracket, developing employees will not receive crucial training, because the jobs will go to people who can already perform the work without training. Thus, the developing employees will enjoy fewer advancement opportunities, if they can even find a job at all.
Because the minimum wage prevents so many young people, and a disproportionate number of minorities, from getting entry-level jobs, it doesn't seem feasible to raise the rates any higher. If minimum wage is set too high, other prices for commodities should rise, and those people who can't break into the job market will never develop the skills necessary for higher-paying jobs. This is where the government aid steps in. While the documentary "Waging a Living" successfully shows that it is almost impossible to support a family on minimum wage, I don't think that's what minimum wage was designed to do anyway. Contrary to the statements of its advocates, fewer and fewer low-wage employees are supporting a family on the minimum wage, with only 9 percent of low-wage employees actually supporting a poor family. The 16-year-old pizza delivery boy should not be making enough money to support his family. Minimum wage is meant to be used as a starting point, and for those who get caught in the minimum wage cycle have other means of government aid to help.
Therefore, effective anti-poverty programs should concentrate on family income and not wages. While most working poor families will not receive any benefit from an increase in minimum wage , the vast majority would receive a benefit from increases in the generosity of federal and state programs. These programs provide targeted assistance to the low-income working families so often cited in support of minimum wage increases—the same families that receive a minority of the benefits from a wage increase.
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