Economics Essay Minimum Wage - 1903 Words

Economics Essay: Minimum Wage Mark Mulhern It is most advantageous for the United States’ to not raise the minimum wage from $7.25 per hour to $15 per hour. Multiple studies have shown that increasing the minimum wage is inefficient at raising the poverty level. Also, a trade off of having higher paid, stable jobs as a result of raising the minimum wage is less jobs available, or unemployment. Most people expect it to raise the wages of poverty-stricken families. However, the income distribution effects of changing the minimum wage crucially relies on who is earning the minimum wage (Leigh 432). If there is a relatively large number of teenagers earning the minimum from middle-upper class families, then a rise in minimum wage will have less influence on the poor (Leigh 432). To solve this problem, the United States should work on expanding earned income tax credit, a government issued subsidy that goes to millions of low-income workers that is proven to increase employment and reduce poverty. With this, the United Sta tes can efficiently shrink the income gap of Americans and raise the standard of living of poor families. The minimum wage is the least amount an employer must pay his/her employee for working. (Mankiw). Congress passed the Fair Labor Standards Act in 1938, ensuring that workers have an adequate standard of living by adding a minimum wage (Mankiw). Today, the national minimum wage is $7.25 per hour. Looking at changes in poverty, 15% of Americans were livingShow MoreRelatedTodays Social And Economic Inequality Is A Matter People1343 Words   |  6 PagesTodays social and economic inequality is a matter people are faced with in their daily lives. 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