Should the minimum wage be increased?
February 26, 2014
By Jeremy Quattlebaum, Student Voices staff writer
If you earn a minimum wage, you might be finding yourself with a little bit more money in your pocket.
Thirty states have pending legislation or plans to introduce bills to raise the minimum wage. Some, like Maryland, have proposals to increase the minimum wage to $10.10 an hour by 2016.
President Obama has issued an executive order that raised the minimum wage that federal contractors are required to pay their employees. The raise will bump the pay of workers such as janitors, construction workers, and kitchen and laundry workers on military bases to $10.10 an hour. He also supports the proposed Fair Minimum Wage Act, which would raise the federal minimum wage to $10.10 an hour from $7.25.
The nonpartisan Congressional Budget Office this month released a report that said Obama’s proposal to increase the minimum wage to $10.10 an hour would raise earnings for 16.5 million low-wage workers. The increased pay would lift about 900,000 people out of poverty, the report said. But the CBO report also said that a higher minimum wage would eliminate 500,000 jobs as employers lay off workers or hire fewer workers.
About 2.6 percent of U.S. workers earn at or below the federal minimum wage, with a little over 50 percent of those 16 to 24 years old. The average minimum wage worker is female, lives in the Southern states, is unmarried, works part time, and is employed in the service industry.
The federal government sets the minimum wage for jobs that fall under the Fair Labor Standards Act, which covers most employees. The District of Columbia and 21 states have minimum wages higher than the federal rate. Washington state has the highest minimum wage at $9.32 an hour.
Raising the minimum wage, federally or on the state level, would mean more income for the poorest segment of society. Advocates argue that minimum wage earners spend a larger percent of their earnings, which are subject to income taxes paid to the state and federal government. The Obama administration says higher wages will reduce turnover and increase productivity.
Opponents say that a higher minimum wage would mean job cuts and higher prices for consumers because businesses would pass on increased labor costs to customers. They say that because two-thirds of minimum wage earners are under 30 and mostly in part-time, entry-level jobs, they do not need the raise.
Others say that state governments should focus on creating better, higher-paying jobs and that trying to raise the minimum wage is a distraction and hurts attempts to bring in better paying jobs.
Florida Gov. Rick Scott says a higher rate wouldn’t pull the earners out of poverty, but a well-paying job would. “Even if we did raise the minimum wage, working families will still not be able to make ends meet on those jobs,” Scott said. “We need good jobs that lead to good careers for our families, and that’s what I am focused on.”
What do you think?
Should your state increase the minimum wage? Should the federal government raise the minimum wage? Join the discussion and let us know what you think!
Join the Discussion