Malorey U.

The Effects of Raising the Minimum Wage

Although raising the minimum wage seems to be a simple solution to an extensive problem, there are many underlying problems it could arise.

  Dear Mr./ Mrs. President,  

The official poverty rate in the United States as of 2015 was 13.5% according to the United States Census Bureau. This problem has been addressed by both republic and democratic parties, each having contrapositive views on a proper and efficient way of aiding these American people. The democratic party claims that raising the minimum wage to $15 will benefit the economy. This is a radical idea for a solution.

                          Addressing the Democratic views of raising the minimum wage to $15:                                In 2012, 89.6% of all businesses had twenty or less employees. Of all costs that a business faces, wages and benefits make up the largest expense. If the minimum wage is raised, this will cause businesses to be forced to choose whether to absorb these additional costs, decrease their workforce, decrease employee hours, or put the cost on the consumers by increasing the price of their goods. The American Enterprise Institute says that a ten percent increase in the minimum wage decreases unemployment between 1 and 3 percent. Only 1 out of 10 people who would gain from an increase in minimum wage lived in "poor" households. 67% of people who would gain from an increase in the minimum wage would be a second or third source of income, many of which are middle-class teenagers. Minimum wage workers only make up 3.9% of all hourly paid workers, almost half of those are under the age of twenty-five, most of which are ages sixteen to nineteen. (US Bureau of Labor Statistics) In summary, radically raising the minimum wage would greatly effect small businesses and only benefit a small number of people working for the current minimum wage, most of which would be middle class teens.