Minimum wage increase makes sense

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Cherish Jones | Staff writer

May 29, 2014

The federal minimum wage is $7.25 per hour in the United States. However, recently the Obama Administration has been advocating to pass legislation that would increase it to $10.10 per hour in each state.

The minimum wage was changed in 2009 and hasn’t been altered since. The problem with the federal minimum wage is that it isn’t adjusted for inflation.

The highest recording of minimum wage is from 1968 $1.60, according to the Bureau of Labor and Statistics that amount adjusted for inflation today is $10.55 per hour.

The initial benefit would be that employees would have an increase in earnings and purchasing power that could stimulate the economy. However, many people fear that an increase in wages would cause business owners to inflate their prices to compensate for the increase, which hasn’t been the case in history.

Fortunately, some states are not waiting for the federal government to increase minimum wage and have taken legislation into their own hands. Many states annually increase their minimum wage to adjust for inflation using a Cost of Living Adjustment such as Oregon and Rhode Island.

Some states that don’t adjust minimum wage using a COLA are still increasing it. California’s minimum wage will increase from $8 to $9 July 1 due to the passing of bill AB10.

The idea that a minimum wage increase would lead to job loss hasn’t been the case and doesn’t make economic sense.

Businesses don’t typically hire employees they don’t need, so letting an employee go would decrease production and in return decrease business revenue. Minimum wage is going to increase because it has to.

A majority of working class Americans are earning below the poverty line and cannot afford to live off of a single income.


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