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The Pros and Cons of Increasing Minimum Wage from a Macroeconomic Viewpoint

In: Business and Management

Submitted By paigeypaige
Words 1422
Pages 6
Of all the topics that cause debate across the United States, there seems to be one that can always be debated without end; whether or not increasing the federal minimum wage is actually beneficial to our country and its residents. “Minimum wage is defined as the lowest amount that employers can legally pay their workers per hour of labor” (History and Debate of Minimum Wage). Most jurisdictions have laws that enforce a minimum wage; however there are benefits as well as disadvantages to this type of policy. Minimum wage laws were initially established to reduce poverty and are upheld with particular goals in mind. Those who support minimum wage laws generally believe that these objectives are being sufficiently achieved, which is enough jurisdiction to maintain the laws. Those who are opposed the minimum wage laws usually believe that it harms less skilled workers and raises unemployment (History and Debate of Minimum Wage). There are many pros from the side that is in favor of raising the minimum wage. An increase in the minimum wage would create more job opportunities because it would cause minimum wage employees to spend more leading to an increase in earnings among businesses and requiring them to hire more employees to keep up with their increase in sales. Raising the minimum wage would also allow some people who rely on additional support from the government to be able to support themselves better without being as dependent on social programs. This would ultimately lead to lower taxes as well as a reallocation of funds that provide support for other’s needs. An increase in minimum wage would also lead to a lower turnover rate because employees making a higher minimum wage would feel more satisfied with their jobs and be less likely to quit. This would result in fewer expenses in relation to hiring and training new employees (Halvorson).
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