Would a increase in the minimum wage really hurt American business?

Answer 1

Minimum wage doesn't matter if people can't get any hours..these employers work people part time with no benefits..what good does it do to give them a raise. The last time minimum wage went up..the prices of everything else did to..several months before minimum wage..I think people would be more satisfied with making less if they could work full time and have affordable insurance..Insurance on me with $1000 ded. is like $150 a month..that's over a weeks check full time..and the ded..that's ridiculous..

Answer 2

To everything in life there are trade-offs. Sometimes the pluses outweigh the minuses, but that's rarely the case when something is government imposed.

In most arguments there are those on one side focusing only on the pluses and those on the other focused on the minuses. Rarely do you have someone looking at both. I typically like to try and list each and try to reason which side wins.

Pluses: People who have a low skill job make more money; People feel good about themselves because the "poor" are making more money; May create ripple effect for others to make more money

Minuses: Low skill job pool will either decline or go to the black market giving people less opportunity to get started in the workforce; increases incentive for illegal immigration; may raise prices; may give low skill workers less incentive to improve their skill sets; increases incentives for other illegal activities for unemployed to make ends meet. Those are just a few, I could keep going. By the time I got here, my reasoning was pretty strong that the overall minuses could easily outweigh the pluses. Who really cares about American business? If all or some of the minuses happen American business won't be the only ones hurting, so will Americans.

The only problem is that all of the minuses could happen and nobody would know it. All we know is that when the wage is raised we know people who make more money. We have to rely on impersonal macroeconomic reports (unemployment rate, immigration, etc.) to see the minuses and even then, you actually have to be able to understand and interpret those reports to see - few do.

So the general population tends to support things like raising the minimum wage to achieve the visible results (in this case the pluses), never realizing that they've actually made things worse.

Milton Friedman said that the government's solution to a problem is usually just as bad as the original problem. I believe it.

Answer 3

YES!!! An increase in the minimum wage would hurt American business. It would increase costs and thereby lower profits. It would also decrease the supply of labor. Some business won't be able to pay the higher minimum wage and might have to kick some employees out.

Answer 4

No. It would not hurt American business. Quite to the contrary, it may help. Let me explain. Most businesses probably would increase the price of their goods and services if there were a substantial increase in the minimun wage in order to protect their profit margins. This is not a bad thing. Those who are unfortunate enough to have to accept minimun wage employment are able to participate a little more in the economy. By virtue of the wage adjustment, they have more to spend to meet their personal and family needs. Because of the increase, perhaps they may become less dependent on social programs such as rental assistance, food assistance and medical assistance. If people are less dependent on government subsidies, then potentially business and personal taxes might be reduced which helps to counter the increase in wages. By and large, a minimun wage increase results in increased spending which balances some portion of the increase. Most business people and the government never see the big picture and are dead set against increasing the minimun. There are notable exceptions. There was a guy named Henry Ford who founded the Ford Motor Company. On a single day, he made a decision to double the wages of all his factory workers. His motivation was two fold. He hoped to alleviate an employee turnover problem that was costing him for increased training, lower productivity and poor morale. His second thought was if he paid his workers a higher wage, then more of them could afford to buy a Ford car. Most industrialists of that era thought Ford was crazy. But as Ford developed a stable work force and sales of Ford products increased, it was obvious that the unconventional wage increase worked. Before long, many other auto makers and industrialist followed Fords lead. Anyone who is willing to work should be able to reasonably participate in the economy. It makes sense for the workers, for business and for America!

Answer 5

What happened to keeping government out of the affairs of private business and individuals. There should not even be a minimum wage law. From an economics point of view it is an artificial constraint on the free movement of the supply and demand of labor.

Answer 6

Acutally, the prices woulod go up due to the fact that the minimum wage goes up. This process is called inflation. It basically means that the dollar does not buy as much as it did before, mostly because more people have more dollars to spend. Therefore, it doesn't hold as much meaning. The conclusion is, that as minimum wage rises, so do the costs. Hope that helps.

Answer 7

Yes it would because as soon as stores raised their minimum wage the price of the items in the store would be raised also thus directly affecting shoppers and other chains would start the same trend causing Boycotts and strikes by consumers.

Answer 8

I like your question, it is a good one. Just keep in mind these companies get cheaper and cheaper by the year, As it is the pay raises leave alot to be desired. I personally would not want to feel responsible for my company filing Bankruptcy simply because I request a pay raise. LOL!

Additionally, as the health insurance cost increases 20.00 bux a month - put that next to your annual nickel pay raise, your actually going backwards each year. hehe

Answer 9

d/k. but my question is will it create a 4th class of people.ie low income, middle class and wealthy? at some point does the minimum wage have to freeze.

Answer 10

absolutely not!! they need to increase it as prices go up.