The Minimum Wage
Some of the world’s greatest problems consist of people jumping to a conclusion and assuming without carefully analyzing all consequences and effects of it. An example of this is the Prohibition Act of 1920 where the politicians believed it was a “good,” idea to ban alcohol, but after seeing the consequences of increases in violence, defective products, and gangs, it was soon repealed. This problem occurred partly due to the fact that the people did not realize that illegalizing alcohol would lead America to violent-orientated world. Consequences that are not often noticed by the general public are called, the “unseen,” as famous economist Henry Hazlitt once labeled it (Hazlitt [1]).
It is important to analyze and understand the consequences of each policy before it is passed to avoid harming the public and creating a worse problem than there was before the policy was passed. Just as the Prohibition Act was not carefully analyzed in the 1920s, the same problem exists today with the minimum wage. The general public believes the minimum wage will help the low-skilled and the poor, however some effects of the minimum wage are “unseen.” When the minimum wage is imposed it makes the workers worse off because it creates unemployment among the poor and the low-skilled through supply exceeding demand, workers favoring skilled labor over unskilled, and employers creating a destruction of low-skilled jobs, it makes the poor and low-skilled worse off by allowing employers to take away benefits of the job, and it creates unemployment among the most low-skilled and poor group, the blacks, by allowing employers to discriminate against them.
The Essay on Low Wage Ehrenreich Job Book
Getting by with more than money In the book Nickel and Dimed On (not) Getting By in America the author Ehrenreich, goes under cover as a minimum wage worker. Ehrenreich's primary reason for seriptiously getting low paying jobs is to see if she can "match income to expenses as the truly poor attempt to do everyday." (Ehrenreich 6) Also Ehrenreich makes it extremely clear that her work was not ...
In the economy, the markets are run by supply and demand. The demand of a good has a negative relationship; an increase in price causes the quantity demanded for the good to decrease. The supply of a good has a positive relationship; an increase in the price causes the quantity supplied for the good to increase. Together, the supply and demand create a market phenomenon where both the supplier (producer) and demander (consumer) reach market equilibrium of price and quantity, which satisfies both the supplier and demander (Mankiw 76).
Just like the market for any specific good, the market for labor also constitutes all factors of supply and demand where the supplier is the laborer and the demander is the employer. Because the market finds an equilibrium point that satisfies both the supplier and demander, when the minimum wage is imposed, it is held above the market equilibrium, which forces of supply and demand to go past it and reach its equilibrium point. Since the minimum wage is above the equilibrium point, the quantity supplied is therefore greater than the quantity demanded; some people who want to sell (supply) their labor at the going price are not able to do so, which causes unemployment (Mankiw 120) and proven by special research economists that “the increase in the minimum wage will reduce the overall level of employment” (Mankiw 120).
In addition, when the minimum wage is imposed, some employers will have to cut hours from their employees. Furthermore the minimum wage is harmful for the economy and the people willing to work because it destroys jobs. For example, if there is a low skilled job available that pays $5 per hour, and if the minimum wage is increased to $7 per hour, that job would be “out of business” because no employer will pay someone to do such low-skill labor for $7 per hour. “The minimum reduces the number of low-skilled jobs available” and gives an example of the full-service gas station attendants as a “job that was destroyed by the minimum wage” (Mankiw 138).
The Essay on Min Wage Minimum Increase Increases
Should Minimum wage be increased? Introduction For many decades now, there has been heated debates concerning minimum wages and increases in those wages. Most people have a tendency to assume that when the minimum wage is increased people will benefit. They do not stop to think of the consequences that come from minimum wage increases. The general population merely assumes that people should make ...
In addition researchers state, “Raising the wage floor hurts those at the bottom of the job ladder because there would be fewer low-wage jobs available” (Mankiw 139).
Consequently, by imposing the minimum wage, unemployment is created in the country because the quantity supplied outweighs the quantity demanded (unemployment) and because of the decrease in the number of jobs available. This causes a negative effect on the low-skilled laborers of the country.
Finally, when the minimum wage is imposed on the labor for market, employers can no longer hire on monetary-based incentives, therefore, they begin to hire based on non-monetary-based incentives such as discrimination against a certain race, gender, or religion. Particularly in the United States, the minimum wage discriminates against blacks so when the minimum wage is imposed, “it hurts blacks generally” (“Mankiw 140”).
In fact, when the first minimum wage was imposed in 1931, it was partly meant to create less competition for the whites by preventing black construction workers from taking jobs from white construction workers by working for lower wages” (Johnson [2]]).
Specifically today, if an employer has to pay both a white person and a black person the same minimum wage, and they are both equally qualified, he/she will favor his/her racial group, and according to Tannette Johnson’s study, “[black] discrimination is alive and well in the hiring process” [Johnson [2]).
Johnson continues to show in his study of how a black man and a white man, both alike in their qualifications, applied for the same job, and the white man gets the job. Furthermore, after a specific experiments dealing with white men with criminal records and black men without criminal records applying for the same job, “black men…were called back 14% of the time, while white men…were called back 17% of the time” (Johnson [3]).
Therefore, as studies show that black discrimination still exists because employers will favor whites over blacks, then when the minimum wage is imposed, it encourages more black discrimination. The reason is because if the employer has to pay both employees the same amount (monetary decision making) that have the same qualifications, then he/she will choose their favorite racial group (non-monetary decision making) and in the United States, the favored racial group happens to be the whites. Blacks had a poverty rate of 22% while whites only had a poverty rate of 7.5% (Mankiw 435) and in 2003; blacks had a poverty rate of 24% while whites only had a poverty rate of 8.2% (Mankiw 435).
The Essay on A Low Minimum Wage and an Outdated Poverty Line
With cost of living being different from state to state and minimum wage being so low why do we wonder there are so many individuals working multiple jobs, or the crime rate raising or the unemployment being at its highest it has been. How do we expect to be putting money back into the market and getting this country out of debt if we cannot even get ourselves out of debt. Someone once said, “More ...
If the minimum wage causes employers to hire more whites than blacks, and blacks are the majority of people in poverty, then the minimum wage, in turn, has the greatest harm on the majority of those in poverty. In addition, according to Jere Behrman research, among all of the unskilled in 1990, “46 percent of them were blacks compared to 27 percent of them were whites” and further explains how black unskilled labor is rising (Behrman 771) Since the minimum wage “causes unemployment among low-skilled workers” (Behrman 775) and most low-skilled workers are blacks, the minimum wage is in turn hurting the blacks, who also happen to be the most in poverty. Therefore, since the minimum wage causes employers to discriminate against blacks during a hiring process, the blacks will be found unemployed and even worse in poverty. Studies have shown in the 1980’s that “raising the relative minimum wage…hurts those with little schooling in comparison to those with more schooling” (Behrman 773).
Next, Behrman showed in their statistical data that people who receive the least schooling are normally blacks and other minority groups (Behrman 775).
This is because those with least schooling are classified as the “unskilled,” and if employers have to pay their employees a “minimum wage,” they prefer to have more skilled people. Therefore, the burden of unemployment falls heavily on the blacks, especially since they are discriminated against as well. Continuing on this idea, research economist Peter Linneman concludes that “disemployment effects of the minimum wage fall mainly on blacks and those with low education” (Behrnan 776).
And, to extend the data that blacks are the most unskilled and most in poverty currently in the United States, the minimum wage is therefore hurting the most unskilled and most in poverty people of the country as confirmed by Behrman, “Increases in the minimum wage ratio have reduced…blacks below the poverty level” (Behrman 776).
The Term Paper on Minimum Wage
Minimum wage is the lowest rate employees may legally pay for an hour of labor (Merriam, 741). The United States has a minimum wage law to guarantee minimum hourly wages and to prevent the exploitation of workers and provide unskilled and part-time workers with a wage floor. People have argues that the minimum wage has become less of a safety net for primary earners in poor families than a floor ...
Consequently, the minimum wage was imposed to help the poor and the low-skilled workers, but it alternatively hurt the poor by allowing employers to discriminate against the blacks, who happen to be the most in poverty, and it hurt those with the least schooling, who happen to be the blacks.
In summary, after analyzing the effects of an imposed minimum wage, the minimum wage does not truly serve its purpose of helping the low-skilled and the poor. After careful investigation it is seen that the minimum wage hurts (instead of helps) the poor in three main ways. First, when the minimum wage is imposed, it creates unemployment among the poor and the low-skilled by creating a surplus of labor in the market, causing employers to hire those who are skilled rather than unskilled, and destroying the number of low-skilled jobs available in the market. Second, when the minimum wage is established, it leaves the poor worse off than they were before by cutting their fringe benefits of insurance, on-the-job training, and good working conditions. Finally, when the imposition of the minimum wage occurs, it creates unemployment among a specific group of the low-skilled and poor, the blacks, by allowing employers to discriminate against the blacks, and by allowing employers to favor (once again) skilled labor rather than unskilled labor. If the minimum wage is harmful for the low-skilled and poor and specifically the blacks, why is it imposed to attempt to help them? This is partly due to the fact that many people do not see these negative effects and just jump to the conclusion that it is “good”, and Hazlitt calls this the “unseen,” which are consequences that are first not noticed by the general public.
Therefore, it is important to analyze all policies or laws for all groups of people in the society to fully understand them. After careful investigation and comprehension and results of past experiences with the minimum wage, maybe someday the “unseen” will become the “seen” and citizens of the United States will realize the true negative effects of this policy and possibly get it abolished. In general, maybe someday all people can look at the negative effects and positive effects of a policy, use a cost-benefit analysis to compare them, and not jump to a right-away conclusion so that any policy can truly be understood before it is passed.
The Essay on Barbara Jordan Texas Wage Minimum
Barbara Jordan The book 'Barbara Jordan' is about a politician / humanitarian Barbara Jordan. Barbara Charlie Jordan was born on Febuary 21, 1936. In 1953, Barbara Jordan graduated from Phillis Wheatley High school; from there; she went on to Texas Southern University where she graduated magna cum laude. She then continued her education at Boston University Law School. Afterward she returned to ...
