While giving a raise worth more than $3,000 a year to the country’s lowest paid workers is definitely a good thing, it is hard to get too excited about a situation in which these workers will still be earning less than their counterparts did almost 50 years ago. By targeting wage levels that roughly move in step with inflation we have implemented a policy that workers at the bottom will receive none of the benefits of economic growth through time. In other words, if we hold the purchasing power of the minimum wage fixed through time, as the country as a whole gets richer, minimum wage workers will fall ever further behind.
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Wednesday, February 20, 2013
Minimum Wage: Who Decided Workers Should Fall Behind?
It was encouraging to see President Obama propose an increase in the minimum wage in his State of the Union Address, even if the $9.00 target did not seem especially ambitious. If the $9.00 minimum wage were in effect this year, the inflation-adjusted value of the minimum wage would still be more than 2.0 percent lower than it had been in the late 1960s. And this proposed target would not even be reached until 2015, when inflation is predicted to lower the value by another 6 percent.
While giving a raise worth more than $3,000 a year to the country’s lowest paid workers is definitely a good thing, it is hard to get too excited about a situation in which these workers will still be earning less than their counterparts did almost 50 years ago. By targeting wage levels that roughly move in step with inflation we have implemented a policy that workers at the bottom will receive none of the benefits of economic growth through time. In other words, if we hold the purchasing power of the minimum wage fixed through time, as the country as a whole gets richer, minimum wage workers will fall ever further behind.
While giving a raise worth more than $3,000 a year to the country’s lowest paid workers is definitely a good thing, it is hard to get too excited about a situation in which these workers will still be earning less than their counterparts did almost 50 years ago. By targeting wage levels that roughly move in step with inflation we have implemented a policy that workers at the bottom will receive none of the benefits of economic growth through time. In other words, if we hold the purchasing power of the minimum wage fixed through time, as the country as a whole gets richer, minimum wage workers will fall ever further behind.
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3 comments:
Finally a truthful article on our poorest paid workers. I am so sick of reading the whiny arguments against paying more to those in working poverty. Its sad that workers and their children go to bed hungry or can't keep a roof over their heads just so we can pay a bit less for our groceries or for the crap we buy from china, all the while working for the richest corporations, performing work we would never stoop to because it was beneath us.
It has been proven time and time again that every time they raise the minimum wage, more people loose their jobs.
The only reason the dumbocrats want to raise the minimum wage is that union contracts are tied to the minimum wage.
Don't assume that all businesses are against this. They are only pretending. Big business is behind this and democrats pander to big business. It's a ploy of big business to keep on elimination competetion any way they can. Of course the small mom and pop business that employes kids on a part time basis will feel the effects but big corps such as Walmart will not because they can raise prices in such a strategic way it will not be felt by consumers.
While I agree minimum wage should be raised in some instances, doing it across the board isn't the answer.
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