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Edward Schildnecht
Professor Cindy Casper
English 101
November 9, 2016

Minimum Wage in America: Why the Minimum Wage Should Not Be Raised

The majority of the workforce in the United States works at or below the federal minimum wage;
Is it time that this wage be raised? The United States federal minimum wage has been set at $7.25 per
hour since 2009. That means that it has been seven years since any change has been made to it. Many
people believe that raising the minimum wage should not be because it could possibly harm low-income
families, is suspected to raise unemployment, and overall would hurt the economy. On the other hand,
there are also numerous people who believe that raising the minimum wage should be done for both
ethical reasons, and because they believe that it would not have the negative effects that others suggest.
Despite the existing argument that the minimum wage should be raised, The United States government
should not raise the minimum wage because raising the minimum wage would have negative effects on
the economy.

One of the largest problems that rises around the notion of raising the minimum wage is how it
would affect employment. Many people argue that an increase to the minimum wage could result in an
overall increase to unemployment. In fact, in the article Raising Minimum Wage Increases

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Unemployment, by Christopher Jaarda, several instances are observed where, in the past, when the
minimum wage was increased a correlation between such an increase and a sudden rise in unemployment
existed. In particular, following an increase to the minimum wage in 1990 unemployment went from
5.2% to a peak of 7.8%. Similarly, following a substantial increase of 41% to the minimum wage in 2007
unemployment went from a low of 4.1% to a high of 10.1%. In each of these case economists have failed
to relate another cause of the sudden spikes in unemployment other than the increase to the minimum
wage. Therefore, these instances demonstrate that a raise to the minimum wage could seriously be
detrimental to the economy. It is historical evidence like this that clearly provides justification as to why
The United States should not raise the minimum wage.
In contrast, there are also
many people who believe that
increasing the minimum wage
would not have a negative effect
on employment. According to The
U.S. Department of Labor
Statistics over 600 economists,
including seven Nobel Prize
winners, collectively signed a
letter to the president and congressional leaders advising that the minimum wage be raised. In the letter
they addressed this topic stating that increases in the minimum wage have had little or no negative effect
on the employment of minimum-wage workers, even during times of weakness in the labor market.
Furthermore, they argued that an increase to the minimum wage could even be beneficial to the economy:
Research suggests that a minimum-wage increase could have a small stimulative effect on the economy.
Despite the large support behind the movement of a higher minimum wage, however, there is still little

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solid evidence or, for that matter, occurrences that have shown a positive effect of increasing the
minimum wage. This then begs the question what is the intended effect of raising the minimum wage?
Some believe that an increase to the minimum wage is not only the ethical thing to do, but that it
could also benefit low-wage and unskilled workers which, in turn, would benefit low-income families,
and possibly stimulate the economy. This is one of the main goals of increasing the minimum wage. As
reported by the article "New York State Act to Mandate $15 Minimum Pay" by Patrick McGeehan, it is
stated that raising the minimum wage (in this case to $15 per hour) would represent a raise for over 70%
of workers that are currently making New York states minimum of $8.75 per hour. In an ideal situation
that increase could potentially help support many low-income families, but it would have to be exactly
that, an ideal situation. Additionally, people believe that, by raising the minimum wage, low wage
workers would then have more money to spend and therefore stimulate the economy. The main problem
with this is that the number of jobs that would be lost would counteract the increase in disposable income
of workers who received a raise. Data like this makes the act of increasing the minimum wage seem as if
it would be beneficial to many people, and, while it could be, there is substantial evidence otherwise.
Recently there have been many cases where states and cities are raising their minimum wage.
This has been happening despite a wealth of evidence suggesting that doing so could hurt low-income
families, which is the opposite effect of what an increase to the minimum wage is supposed to do. As
reported by David Neumark in the piece Who Really Gets the Minimum Wage, it must first be
understood that low-wage workers and low-income families are not the same. In fact, many low-wage
workers are in higher-income families - workers who are not the primary breadwinners and often
contribute a small share of their family's income. The problem with this is that raising the minimum
wage is targeted specifically at low-wage workers in order to help support low-income families, but lowwage workers often do not come from low-income families. For instance, if the minimum wage were to
be increased to $15 per hour the benefits would be disproportionate: for a $15 per hour minimum, the
share of benefits going to poor families would decline to 12%, and the share to families more than three

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times the poverty line would increase to 36%. This happens because, more often than not, the people
working for the minimum wage are not the working class workers that raising the minimum wage is
supposed to benefit. Instead the majority of the workers that would profit from increasing the minimum
wage are young adults who often live at home with their parents and whose jobs are used to earn spending
money. Therefore, if the benefits of raising the minimum wage do not positively directly impact those
targeted by it, why should it be raised at all? This demonstrates yet another reason why raising the
minimum wage is problematic and should not be done.
Another problem with raising the minimum wage is how would it would affect prices for
consumers. Logically it makes sense that when the cost of labor for a business increases so too would the
cost of the products and/or services that the business provides. This can be observed through
Connecticuts increase of 25 cents an hour to their minimum wage in 2009. As stated in the piece
Minimum Wage Doesnt Help The Poor by Kristen Lopez Eastlick, This years wage increase of 25
cents an hour translates to $10,000 in annual costs for a business with 20 minimum-wage employees, the
issue with this is that for a business with only small profit margins to recover from this loss in cost of
labor they would need to increase their sales by hundreds of thousands of dollars. This creates a drawback
of its own because when businesses cant afford the cost of labor they are forced to make up this cost,
which often means raising the prices of their products for consumers. The other side of this is that when a
business decides it doesnt want to raise prices its often left firing employees and reducing employees
hours.
On the other hand, some argue that businesses could afford raising the minimum wage. Some
businesses even support increasing the minimum wage suggesting that there would be no increase to
consumer costs. According to The U.S. Department of Labor Statistics article Minimum Wage
Mythbusters, which can be found here, a July 2015 survey conducted by Small Business Majority, a
small business advocacy group, stated that, 3 out of 5 small business owners with employees support a
gradual increase in the minimum wage to $12, displaying the idea that most business owners wouldnt

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be bothered by raising the minimum wage. Furthermore, the same survey also reported that small
business owners agree that increasing wages would be directly beneficial not only to low-wage
employees, but also for the economy because when these workers incomes increase the demand for
goods and services is likely to increase as well which would help stimulate it. Again, however, there are
issues with this, primarily being that there are very few incidences where these ideologies have played
out.
Considering either side of the argument behind whether the minimum wage should be raised, The
United States government should not raise the minimum wage because raising the minimum wage would
have negative effects on the economy. This is reinforced through: historical evidence of cases where
minimum wage increases have drastically affected employment, studies which show that raising the
minimum wage will not help low-income families and low-wage workers (like it is supposed to do),
and the fact that raising the minimum wage has been linked to an increase in consumer prices. Although
the argument in support of increasing the minimum wage does exist there is still such little evidence that
the benefits outweigh the disadvantages of doing so. Therefore, the minimum wage in The United States
should not be raised.

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Works Cited
"Minimum Wage Mythbusters." United States Department of Labor. N.p., 09 Dec. 2015. Web. 09
Nov. 2016. <https://www.dol.gov/featured/minimum-wage/mythbuster>.
Neumark, David. "Who really Gets the Minimum Wage." Wall Street Journal, Eastern edition
ed.Jul 07 2014. ProQuest. Web. 9 Nov. 2016.
Eastlick, Kristen Lopez. "Employment Policies Institute | Minimum Wage Doesnt Help The
Poor." Employment Policies Institute. Waterbury Republican-American, Dec. 2009. Web. 09 Nov. 2016.
<https://www.epionline.org/oped/o142/>.
Jaarda, Christopher. "Raising Minimum Wage Increases Unemployment." Unemployment. Ed.
David Haugen and Susan Musser. Detroit: Greenhaven Press, 2011. Opposing Viewpoints. Rpt. from "Is
the 2007 Minimum Wage Increase a Contributing Factor of the Recession?" A Line of Sight. 2010.
Opposing Viewpoints in Context. Web. 5 Oct. 2016.
McGeehan, Patrick. "New York State Act to Mandate $15 Minimum Pay." The New York Times.
N.p., 23 July 2015. Web. 5 Oct. 2016.
Branco, A. F. Political Cartoon about Minimum wage. Digital image. Liberty Alliance. N.p.,
2013. Web. 24 Nov. 2016. <http://libertyalliance.com/>.

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