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Marmin Reyes
Professor Chiquita Boyd
ENG 111
Essay 4 Final Draft
2 December 2014
Minimum Wage
Citizens in the United States would love to get a good raise and take some extra money
home. President Obama is trying to increase the minimum wage to help poor and low income
families in the United Sates. As good as this sound, citizens need to investigate and know what
really is going to happen if the minimum wage is raised. It is important to know the negative and
positive consequence of it so citizens can evaluate it for themselves. The minimum wage
should not be increase because small businesses are going to close, prices are going to go
up, and teenagers with no job experience are not going to find a job easily.
The minimum wage was first introduced in 1938; the bill was signed by President
Franklin D. Roosevelt with a starting wage of 25 cents an hour. The minimum wage has change
a lot over the past 65 years. Congress usually increases the minimum wage when the economy is
high and there is not a lot of unemployment. The last time it was raised was in 2007 from $5.15
to $7.25 an hour. Some states have raised the minimum wage higher than the federal rate. The
people that mostly earn the minimum wage are teenagers and single mothers. The president of
the United States is trying to help people that are struggling to support their families.
The president, Barack Obama, has been trying to raise the minimum wage to help the
people that need it the most. He said that if the minimum wage is raise citizens are going to have
more jobs and America is going to have a stronger economy. America is going to have a stronger

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economy of course because people are going to spend more money if they earn more. He also
said, Keep pushing until we get a higher minimum wage (Los Angeles Times). He wants the
citizens to put more effort so the minimum wage can be raise. It could be possible those low
income families could take home more money and they could support their families better but if
they use the money the right way. If people get pay more, they are going to spend more money
on stores and others things that they do not really need. In reality this could be very negative for
some low income workers. Employees will get their raise and everything is going to look right
but after a few months when small businesses cannot afford to paid that much money they are
going to start to lay off people.
Small businesses are not financially strong enough to pay employees ten dollars an hour,
if the minimum wage does increase. The businesses will struggle even more to pay their
employees and other necessities they have. Businesses will start cutting hours on their employees
or just laying people off. Employees are going to start losing their jobs and they are going to be
more affected than what they were before. Businesses are going to start looking for other
alternatives that will be cheaper and effective to sell their products. In an article written by Andy
Puzder, he said, But here's what middle-class business owners, who live in the real world, will do
when faced with a 40% increase in labor costs. They will cut jobs and rely more on technology. Such
changes are already happening in banks, gas stations, grocery stores, airports and, more recently,
restaurants. Almost every restaurant chain in the country from Applebee's to McDonald's is testing or
already implementing automated ordering with tablets or kiosks. The president's minimum-wage hike
might cost 500,000 jobs, according to Congressional Budget Office estimates (Puzder).

When small

business faced all these cost, they might just close their business or they start raising prices on all
their products.

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The prices on the products that we need the most are going to be increased. Food and gas
are essential for our daily routine and people must have them. For years, food prices have always
gone up and businesses never lower their prices back again because people always buy it. Food
is something that people need in their lives and citizens will always buy it no matter how
expensive is it. The prices each time people go to the store for food are higher and higher and
people do not have a choice other than just paying for it. Gas is another product that citizens
really need in their life. Cars without gas cannot run which means people have to put gas in order
to go to places. One of the places that they have to go is to their jobs because they need to make
money to pay rent, bills and food. People need the money to buy the things that they rely on. It is
a circle; first citizens have to buy something from a business to get paid by another business. A
business that is going to start making money in big if the minimum wage is raise is the real estate
because properties are going to increase a lot.
The houses prices and taxes are for sure going up if the minimum wage is raise. If people
start earning more money, they are going to start buying houses because houses are very ship
right now. If citizens are making more money, they can get a loan easier or they can save the
money to buy the house but at the end the government is the one that is going to make the most
out of it. The more houses are sold the higher prices people are going to be getting. Property
taxes are going to be higher because the houses are going to be more expensive. Then citizens
are going to have the same problem again, they are not going to be making enough money to pay
for their things. If the minimum wage is increase, it might benefit heads of households but no
teenagers and students.
Teenagers with no job experience are not going to find a job easily. Businesses would not
want to pay ten dollars an hour to employees that do not have the skills or the job experience to

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do the work. They of course are going to be looking for people that have experience and know
the job. The more affected are going to be teenagers because they need an entry level job. A
higher minimum wage has the biggest impact on those with the least experience or the fewest skills.
That means in particular those looking for entry-level jobs, especially teenagers. And thats exactly
what happened when the minimum wage rose by 41% between 2007 and 2009 it had a disastrous
effect on teenagers. The jobless rate for 16-19 year olds increased by ten percentage points, from
about 16% in 2007 to more than 26% in 2009 (AEI. N.p.).Teenagers do not have any experience

or skills and they look for someone to give them that opportunity. Students also will be affected
because they might just look for a part time and different hours and businesses would not like to
train people that would just work a few hours or a short period of time. Students sometimes quit
work to stay in school and businesses would have to hire and train someone else. Businesses
would not like to be doing these because they will lose money and time. In 2007, the minimum
wage was raised in Los Angeles C.A. My brother was 16 years old at that time, he applied in
every business he could but no one hire him. After a year that he was struggling to find a job, his
family and him moved to North Carolina and there was where he got his first job. Some
businesses would not bother to train teenagers because they would not want to waste money and
time. If businesses are not hiring teenagers there is going to be more unemployment because all
does teenagers that cannot find a job are just going to stay home or go out with their friends.
More teenagers are going to be on the streets doing nothing and more crimes will happen. In
other words the minimum wage should stay the way it is right now.
In conclusion, by increasing the minimum wage the government is not going to help poor
families directly because some of them do not even have a job. First citizens need to find a job in
order to possibly benefit from the minimum wage raise. If the minimum wage is increase the
economy will increase quickly. In other words, the country is going to benefit more than poor or

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low income families. In contrast, as of the early 2000s 34% of low-wage workers were in families
that were far from poor, with incomes more than three times the poverty line. In other words, for
every poor minimum-wage worker who might directly benefit from the minimum wage, two workers in
families with incomes more than three times the poverty line would benefit (Sanderson, Allen R.).

The government should create more middle class jobs so more people can get hire and in that
way they are getting help. There are also other alternatives the government can use to
specifically help poor families out for example the earned income tax credit. Low wage workers
and poor families need to be help directly and as much as they can. The Earned Income Tax
Credit directly targets low-income families, rather than low-wage workers (Neumark, David).

The

government knows that the earned income tax credit will help a lot of people directly but they do
not do it because it is not going to benefit them in any way. What they are looking is for
something that would benefit them more than the others. The ones getting the most out of it are
the well pay employees. The government and people that are well pay are the ones that are
going to benefit more than low wage workers or poor families if the minimum wage is raise.
Citizens are going to be wasting more money if they earn more money. David Neumark said,
The desire to help poor and low-income families is understandable. But increasing the minimum
wage is a misguided way to do it (Neumark).

Works Cited
"Let's Review the Adverse Effects of Raising the Minimum Wage on Teenagers When It Increased
41% between 2007 and 2009 - AEI." AEI. N.p., n.d. Web. 30 Nov. 2014.
Neumark, David. "Who Really Gets the Minimum Wage." Wall Street Journal. 07 Jul. 2014: A.11. SIRS
Issues Researcher. Web. 24 Nov. 2014.

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Puzder, Andy. "Minimum Wage, Maximum Politics." Wall Street Journal. 06 Oct. 2014: A.17. SIRS
Issues Researcher. Web. 23 Nov. 2014.
Sanderson, Allen R. "The False Promise of Hiking Pay." Los Angeles Times. 21 Sep. 2014: A.22. SIRS
Issues Researcher. Web. 24 Nov. 2014.