If you look at minimum wage from the average workers eyes, raising it would be extremely beneficial but the closer you look, it may not be the solution we’re looking for.
The issue we’re facing is whether or not raising the federal minimum wage, the just amount of pay for people that are employed, would be favorable in the long run. Raising minimum raise would in turn damage small businesses, larger companies will turn to technological labor resulting in an increase in unemployment. Increasing working pay will cut into businesses budgets.
Most smaller businesses have small margins and if an increase this much were to happen many businesses will be forced to close. With businesses trying to keep in their margins many people will be left without a job or hanging on by a thread, unable to find another one. The quality of labor demands decrease, creating unemployment. For example if a restaurant needs to raise their staff pay to 15$ they will need to increase prices on the menu, resulting in losing business or disregarding the law and paying people under the table, or they will lay off employees. Even with these budget cuts many of these small businesses will still be forced to close down – or deploy technology.
Many businesses are already switching over to technology instead of workers.
In an article from forbes magazine they expect “this trend will soon become prevalent in the food industry, hospitality, retail, construction, and manufacturing. Recently even amazon has begun doing this, replacing workers with Amazon Go stores with no lines and no check outs. These advancements would push out workers from jobs.
Another thing many people don’t think about when they think of raising minimum-wage is that it would reduce the incentive of low-wage workers from getting an education and moving to a higher paying job. The lower the minimum wage the more eager a worker will be to enroll in community college courses online or at night to improve their skills and work towards a more competent job. If a minimum wage worker is making good money to live at a full time bottom entry job they will have no motivation to move their career. Even teens could be lured by the comfort of making 15$ an hour and our future generation won’t want to receive a higher education.
You could say that raising the minimum wage would hypothetically pull people out of poverty or increase people’s lives. Unless they lose their jobs due to companies laying people off or hiring less. The effects of low wages can be seen as a result throughout the economy and social scene. As wages are low there is a drop in purchasing and workers are more likely to take on more work in order to live on the pay. The idea of raising minimum-wage could be described as noble and commendable but the economic ramifications will greatly impact the same people it’s trying to help.
The raise of minimum wage could incidentally create larger problems in rates of poverty and business damage. Its logical the world tries to measure the impact of the increase in minimum wage. You also have to look at not just at the change in jobs, but at changes in the lives of those struggling against empowerment. If millions have been lifted out of dire poverty, and if more workers were able to provide for themselves and their families. After all, that’s the whole point of a minimum wage: to ensure that every American can live on a full day’s labor.