Why should we increase the minimum wage? Essay
Why should we increase the minimum wage?
While the recent cost of living has risen, the minimum wage has remained stagnant, creating historic profit margins for companies that employ minimum wage workers. This uneven balance of the distribution of wealth is causing a significant amount of our population to suffer below the poverty line. Today, I urge you to vote in favor of this legislation in order to ensure that every single citizen of our country will be able to live a comfortable life, above the poverty line. The first benefit of raising the minimum wage is that such a raise will help bring a significant population of workers out of poverty. According to the U.S. Bureau of Labor Statistics, in 2012, approximately 9 million American workers earned a minimum wage per hour or less and 77% of these 9 million workers are the single income for the household.
A full-time minimum wage worker makes $14,500 a year, leaving a two-person household below the federal poverty threshold of $15,130. About 70 percent of minimum wage employees, however, work fewer than 35 hours per week and thus earn proportionately less. In any case, a full time employee earning minimum wage in our country should not be below the poverty threshold. Therefore, raising the minimum wage would help bring the workers out of poverty. Once the workers are no longer below the poverty threshold, the government would save money on welfare payments and other savings that would be good for the nation’s economic health.
In the United States, $131.9 billion is spent annually on welfare and the welfare one person gets is equivalent to an average hourly wage of $13.68. As of now, 4.3 million people are making minimum wage still need welfare, housing assistance and other government money just to survive. If we raise the minimum wage, a significant number of people who are on welfare would no longer require it and the government could focus that money on other programs. Lastly, this legislation must pass is that increasing the minimum wage would act as an economic stimulus. When low-income households earn more money, they are more likely to spend it, pouring more dollars into the economy. In fact, a recent study by the Federal Reserve Bank of Chicago concluded that, following an increase in the minimum wage, spending by households with at least one minimum-wage worker increased by $700 per quarter.
The Economic Policy Institute further concluded that “By increasing workers’ take-home pay, families gain both financial security and an increased ability to purchase goods and services, thus creating jobs for other Americans.” A higher minimum wage would also decrease turnover and thus keep training costs down for companies. This also means that the companies would not have to fire individuals or cut costs in any other field. In the end, increasing minimum wage, will help bring workers out of poverty, improve the national economy, and save government money which is why I strongly urge you to vote in support of raising minimum wages.