Living and Minimum Wage

Topics: Minimum wage, Supply and demand, Employment Pages: 3 (983 words) Published: March 17, 2014
Living and Minimum Wage Paper
Jamie Ratzlaff
Economics
10-8-11
P.6
It might seam that a living wage is a good idea compared to a minimum wage; although, the repercussions may cause people to think differently. Living wage could cause unemployment to rise, create higher prices causing profits to decrease. If people’s income increases, people will get fired, prices will rise, and profits will decrease. Granted, a living wage could improve people’s spending immensely and decrease job turnover; however, it honestly is an erroneous decision to choose living over minimum wage. Problems come with both living and minimum wage making it difficult to choose the form of wage to pursue. A minimum wage is a varying wage set by state law or union agreement. The questioning factor whether everyone get by on a minimum wage that can cause an unhealthy living environment. Minimum wage can also cause social problems: riots and protests. A living wage is a set wage of $12.50 per hour that allows college, groceries, housing, and gas to be affordable. The problems that occur include rescission, increase in the price of goods, and less profit for the producer. The consequences of a living wage hurt the poor by increasing prices defeating the purpose of an imposed living wage. Evidence supports living wage it is a respectable idea. If Americans were paid $12.50 an hour people would spend more money. When people’s income increase their demand for goods increase. (Cooper), “If an employee at McDonalds or Pizza Hut suddenly has additional income, they could spend it at Walmart.” Living wage also reduces employment turnover. Suppose someone gets paid $12.50 an hour opposed to $7.25 an hour, they’re less likely to resign from their job.(Jillian Burham), “A review in recent research from the center of economic and policy research found that when state and local lawmakers raised the minimum wage in their areas, the move resulted in limited or no job loss.” The positive things linked to...
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