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Pros and Cons of Raising the Minimum Wage

Many citizens of the United States of America are not satisfied with their hourly incomes. Hence, the population wants its government to raise the minimum wages in the country in order to reduce poverty. Increasing the minimum wage should help some works, and it will help stimulate the economy overall by increasing the purchasing power of many employees whose wages would also go up. Therefore, the minimum wage is essential to be raised.

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Definition and Benefits of Raising the Living Wages

A minimum salary is the established amount of earned money, which has to be officially paid to a worker by his or her employer every hour of one’s labor activity. An employee can sell one’s labor or time for this payment to small businesses, U.S. government or any other profitable organizations and structures. The minimum wage is determined by the government and corresponds to the primary needs of the local population (Card & Krueger, 2016). However, there are some positive and negative factors, which can appear due to the minimum wage raising factor.

The first decisive is that raising the living wage would produce more working places and increase the economic system in the USA. If an average American received ten dollars per hour for his or her manual labor, instead of seven, these payments would help the country to create almost eighty-five thousand new jobs for its’ residents (Card & Krueger, 2016). Besides, the same factor would inject twenty-two billion dollars into the national political economy. Furthermore, the higher minimum wages might reduce poverty from foodless districts of metropolises (Barany, 2016). Citizens might be able to afford an inhabitable apartment or another piece of a living property. Another benefit from raising the living wage is that the U.S. government might reduce welfare expenses, which are provided to the low-income employees or challenged citizens every year. Nowadays, many Americans depend on income-support programs.

It would be proper to mention that the purchasing power of Americans has dropped since 1968 (Barany, 2016). The inflation does not affect the minimum salary in America. Therefore, raising the base pay might increase the purchasing power of American citizens. Moreover, the living wages are crucial to be raised in order to stabilize inequality among employed residents of the USA (Meer & West, 2016). This issue remains a tremendous challenge for Americans because only one percent of the country’s population earned twenty-two present of the pre-tax income in 2012.

Furthermore, increasing the living wages to employees might reduce gender or race inequality in the country. The official Statistics show that sixty-three percent of the minimum wage jobs are occupied by women (Meer & West, 2016). Raising the base pay in America would also raise the salaries of people whose income is a little bit over the minimum wage. Finally, the majority of people and young families cannot afford a decent housing for themselves because they do not get paid enough (Barany, 2016). This unsettled question can also be solved by raising the minimum wage.

Consequences and Disadvantages

Indeed, sometimes it does not seem to be possible to increase the minimum wage in a country or a state without incurring losses. For instance, many businesses in Seattle were obliged to provide thirteen dollars hourly payments to their employees, which had negative consequences – many workers were fired or their hours were cut. (Belman & Wolfson, 2014). It would be relevant to state that the base pay in the USA reached its highest peak (11, 25 dollars) in 1968. Besides, the United States Labor Department provided a Statistics of people who work for a minimum wage, which indicated that only three percent of Americans are occupied with this kind of jobs. Moreover, fifty-eight percent of employees work part-time, and forty-five percent of living wage employees are underage.

One of the most significant disadvantages of raising the minimum wage is that this law will force small companies to go out of business due to their inability to pay higher salaries. For instance, fast-food restaurants might be obliged to increase prices up to twenty-five percent in order to pay wages to their workers (Meer & West, 2016). Besides, the low-skilled workers might be disadvantaged, whereas students and young adults might be laid off during a business depression (Card & Krueger, 2016). Another consequential move is replacing workers by robots or similar automatic mechanisms – their involvement into the production process requires less human resources and investment. Moreover, big manufacturers are likely to move their fabrication processes to villages or less popular provinces in order to lower the expenses for their production.

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Regular People’s Viewpoint

The recent opinion poll indicated that the majority of the American population wants their minimum salaries to increase due to the lack of finances for housing, vehicles, children support, and so on. The minority of American residents were aware of both positive and negative consequences of raising the minimum wages (Belman & Wolfson, 2014). Unfortunately, only two percent of interviewed people said that their lifestyle and welfare is unlikely to improve due to the minimum wage raise.

It is a well-known fact that every American state has its own laws and regulations, which have their impacts on the minimum wages as well. Therefore, the highest minimum wage is paid to the workers of Portland subway system in Oregon. Employees of this structure receive eleven dollars and twenty-five cents per hour (Belman & Wolfson, 2014). According to the same rule, people from Wyoming and Georgia, do not make more than five dollars and fifteen cents per hour. The government tries to make all people more or less equal in their incomes. This effort somewhat disappoints highly-educated workers because they might receive a low salary for their job, whereas uneducated personnel receives the same amount of money.

Nevertheless, almost eighty percent of interviewed people agreed that the minimum wage of seven dollars and twenty-five cents is not enough for them to live on. Besides, some individuals who cannot find a well-paid job prefer to be on a federal welfare because it is almost equal to the living wage in the country. This factor worsens the local economy system (Card & Krueger, 2016). There is a group of Americans that is called The US Living Wage Movement. It was established in the 90s, and their primary goal is to reason the government into increasing the minimum wage up to fifteen dollars per hour.


The government of the United States has to increase the minimum wages for the country’s residents and citizens. Indeed, some economic difficulties might appear in the system at the first time, but pluses and benefits overweigh these insignificant issues. The higher minimum wages will increase the living standards, reduce poverty and will provide housing to every American person. Besides, this move will stimulate the economy by reducing robbery, unemployment, mass manufacturing, and so on.


Bárány, Z. L. (2016). The minimum wage and inequality: The effects of education and technology. Journal of Labor Economics, 34(1), 237-274.

Belman, D., & Wolfson, P. J. (2014). What does the minimum wage do? Kalamazoo, MI: W.E. Upjohn Institute.

Card, D. E., & Krueger, A. B. (2016). Myth and measurement the new economics of the minimum wage. Princeton, NJ: Princeton University Press.

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Meer, J., & West, J. (2016). Effects of the minimum wage on employment dynamics. The Journal of Human Resources, 51(2), 500-522.

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StudyCorgi. (2022, January 23). Pros and Cons of Raising the Minimum Wage.

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"Pros and Cons of Raising the Minimum Wage." StudyCorgi, 23 Jan. 2022,

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StudyCorgi. "Pros and Cons of Raising the Minimum Wage." January 23, 2022.


StudyCorgi. 2022. "Pros and Cons of Raising the Minimum Wage." January 23, 2022.


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