Minimum Wages

Minimum wage is the lowest hourly wage allowed by federal and state labor laws. With a few exceptions, minimum wage generally applies to unskilled or semi-skilled workers. Minimum wage began in 1938 to protect the unskilled and semi-skilled. Before 1938, employers and supply and demand determined wages.

Minimum wage is a good thing, but the problem is that when minimum wage is too low, it is not enough money for anyone to have the incentive to work. Minimum wage was created to help the semi-skilled or unskilled workers, yet these are the same people who make more on welfare than they do if they work. If the minimum wage is not raised, we are continuing the cycle of citizens being dependent on the government's programs.

The solution to the problem would be raising the minimum wage by indexing it for inflation. Inflation indexing makes sure that those who are paid minimum wage can pay for the same goods and services they have been using. It provides a long-term solution to the problem of decreasing real wages for minimum wage workers.

There are some costs and benefits to raising the minimum wage. The benefits are obvious. Raising minimum wage helps the poorest families, especially single mothers. While people or families will not be raised out of poverty, it will lift some of the burden they face and boost morale overall. Having a reasonable minimum wage is a step closer to ending poverty. It will help communities, because people will spend the extra money at their local businesses. The cost of raising the minimum wage falls upon businesses. Employers have to budget more money to pay their employees, which cuts into their profit margins. Employees may also have to pay in work hours, because employers may cut some hours to compensate for their increased costs.

There are some unintended consequences of raising the minimum wages, both negative and positive. The main negative effect is that businesses will not hire as many people because