http://www.nytimes.com/2014/09/05/business/economy/fast-food-workers-seeking-higher-wages-are-arrested-during-sit-ins.html?ref=economy
There is a movement among fast-food workers for a raise to $15 an hour. Currently the average wage is $9 per hour. These protesters were arrested recently in three-dozen cities, as they protested and went on strike for the cause. Those protesting for better pay are currently dissatisfied with their current level of pay, claiming that minimum wage is not enough to raise a family on. Opponents to the raise of wages to $15 per hour warn that this would hurt businesses as well as many of the workers. With wages at $15 per hour, low skilled workers would be cut from the budget. The higher wages would leave fast food companies with little to no profits. The extreme raise in wages is one that seems to be a good idea for those working in the industry but would in reality cause many problems for both workers and fast food companies.
I think in the short run raising wages would be positive for the economy because more people will be willing to go out and get a job even if they are overqualified. In the long run though i think we will run into the same problem we have now where people are no longer satisfied with the minimum wage rate and want to raise it again leading more people to feel as though the new $15 wage rate is no longer worth their time and people may leave the labor force once again
ReplyDeleteThis ties into the issue we discussed in class on Friday, the idea that if the minimum wage increases to $15.00/hour, prices will rise in turn and, in time, we will be in exactly the same position as before. This is unless workers manage to become more efficient when they become better paid. I believe that both factors would come into play. Perhaps employers would invest in more technology and capital to improve efficiency if the wage rate was higher, and the employees who kept their jobs would be more motivated to work harder. Or, at the very least, employees could utilize the newly invested in technology or capital to increase their efficiency. Inflation would increase, but the end result would be that their wage would be still be worth more than it is now, even if it would not be worth what $15.00/hour is worth in the economy today.
ReplyDeleteThe question that I have would be whether raising the minimum wage to $15.00/hour would cause other wages (such as for more middle class or white collar jobs) to go up as well? Because if it didn't, wouldn't raising the minimum wage have the additional effect of decreasing the wage gap in the United States?