The Record is Clear: Minimum Wage Hikes Destroy Jobs

http://www.forbes.com/sites/realspin/2013/04/17/the-record-is-clear-minimum-wage-hikes-destroy-jobs/

The Record is Clear: Minimum Wage Hikes Destroy Jobs

While being very similar to the first article, this article was a much more aggressive style, and targeted the remarks of a specific individual. Both articles come to the same exact conclusion; raising the minimum wage would not decrease the poverty rate or unemployment, in fact, it might do the opposite. A few months ago, Obama Admin. economist, Betsey Stevenson, released a statement regarding the minimum wage issue using a bunch of false facts and skewed statements. This article basically rips a part what Stevenson had to say in a well deserved manner. In fact, 85 percent of research points to a loss in jobs after an increase in minimum wage. Stevenson also manages to say that an increase in the minimum wage will get rid of poverty. This simply can not be true because 60 percent of those living in poverty do not work, therefore an increase in minimum wage will have no impact on them. For those that do earn minimum wage, a study found that majority of minimum earners do not live in poverty, so therefore they cant be brought out of poverty. Surely with an increase in minimum wage small businesses will have to  cut mass amounts of employment hours or possibly entire jobs. A study finds that with these cuts, people will be pushed closer to poverty because the lack of hours will not be alleviated by the increased wage. 

Another argument for the increase in minimum wage comes from the topic of inflation. Just remember that the value of the dollar can go up and down. So while Obamanists can say that with inflation minimum wage should be 10 dollars or more, an economist can realize that over the years, the value of the dollar has gone up and down, and with some mathematical calculations can deduce that if minimum wage were to be directly based of inflation, then it would be $4.12. Apparently "many" minimum wage earners are "stuck" at the "pathetic" $7.25 an hour, but a recent study showed that MOST (most and many are very very different) minimum wage earners receive an increase in 1-12 months after being hired. Even more intruiging to me is the fact that a single parent with two kids making minimum wage gets a tax credit worth around 5200 dollars, which theoretically increases his/her wage to $9.76 per hour. Interesting right? Have thoughts?

Please comment what you think about this topic below. 

- David Gerhart

http://articles.latimes.com/2013/mar/10/opinion/la-oe-hassett-the-case-against-the-minimum-wage-
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The Minimum-Wage Debate  -  Los Angeles Times

Minimum wage has been ignited once again as a controversial topic in the United States. Let's remember one thing about minimum wage: It was formed to eliminate the exploitation of sweatshop laborers, not to provide workers with a middle class lifestyle. Minimum wage is also defined as the lowest rate that workers can sell their labor. With that in mind, those that do not currently work will have more incentive to go get jobs and therefore the demand for a set number of positions will increase, creating even more job scarcity by definition. Also, with the increase in minimum wage, a company will be forced to reduce the number of its positions or the number of its working hours because they simply won't have enough money to pay employees. With a reduction in jobs and hours, plus a higher demand for those available positions, job scarcity becomes even worse and unemployment rises, because remember unemployment is the state of being without a job but looking for work.

In addition to the aforementioned issue, the majority of people earning minimum wage do not come from poor households.Since majority of the minimum wage earning population does not come from a poor household, how would increasing the minimum wage even have a chance at "alleviating poverty" throughout the nation? Minimum wage is not intended to be a living wage. It is intended for retired people who may want a part time job for some vacation money, or for a kid living at home trying to save money to go to college. In fact, about 50% of workers earning minimum wage are under the age of 25. So for these kids to earn an extra $1.50 would surely help them pay for college or gasoline for their vehicles, but it would not bring their families out of poverty.

Minimum wage does not need to be raised because it would benefit those that are lucky enough to keep their jobs, but it would also cause those that are not so lucky to lose their jobs, adding to the number of people looking for work, and BY DEFINITION increasing the job scarcity in the United States. We all understand that when job scarcity increases, the economy suffers.

For those that would argue for the increase in minimum wage after reading this post and the respective article, please leave your comments below as to why you think that way.

- David Gerhart