Finances & Money

Reader Counterpoint: Minimum wage is for sissies!

Reader Eric Faith sent me two counterpoints to my article “10 reasons why you shouldn’t complain about paying taxes“. I posted the first article titled “Social Security is far from a good thing” yesterday, and today I’ll follow it up with a counterpoint to my comments about minimum wage.

Minimum Wage should be Minimally Managed

To answer Clever Dude’s comment:

“Worker protection legislation like minimum wage (clarified based on comments). I got my first job at age 15 working at McDonald’s (technically, I started 3 months prior with a paper route), and have been working ever since. Throughout college, I depended on my part-time income to finance my social and academic life. If there was no minimum wage enforcement, who knows how little I would have been making. Beyond that, millions of Americans depend on minimum wage to pay the bills. Luckily, state governments are passing more legislation to increase the minimum wage."

Although we all want to help the poor and protect workers, raising the minimum wage is not the answer. Raising the minimum wage actually hurts minimum wage earners and does little to combat poverty.

From a business perspective, if a business depends on minimum wage earners and the wage is mandated up, they aren’t going to shrug their shoulders and go along with it. No, businesses will have to adjust by either reducing costs or increasing prices. A likely cost savings would be cutting workers that aren’t worth the cost of a higher minimum wage. Raising prices will also eventually hurt the workers because it will make their business less competitive. Either way, there will be less demand for minimum wage workers. Better to have a low paying job, than none at all.

From a personal perspective, the majority of minimum wage earners don’t depend on the minimum wage to pay the bills. Only one in five minimum wage-earners lives in a family that falls below the poverty line. Many minimum wage earners only work part-time, are young, and live in households making a decent wage. (60% work part time, 50% are under 25, average family income is 50k)

Furthermore, many of these entry-level jobs allow unskilled workers the opportunity to become more productive so they can be worth more. (I got a small raise shortly after starting my minimum wage job) We need these entry-level jobs and to allow people to grow on their own.

To give Clever Dude credit, over 1 million people in our country could really use that raise! However, I would rather offer direct assistance or education. Managing the minimum wage would only hurt them.

For additional information check out: http://www.heritage.org/Research/Labor/minimumwage.cfm

Thanks Eric! What do the rest of you think about the Minimum Wage issue?

If you ever want your own article posted on Clever Dude, whether in response to one of my articles, or a brand new article of your own, feel free to contact me directly. I won’t promise it will be posted, but I love hearing your opinions and I want my readers to be heard too!