Are the benefits to an increased minimum wage?

Question

The way I see it, any possible benefit to those making minimum wage would be offset by the increase in price of goods and services by businesses trying to offset the increased cost of labor.

MRod

How will this help if businesses decide to raise prices, which would be logical, to offset the increased cost of labor or cut the cost of labor by terminating employees?

Mrod

I don't doubt that it is difficult or impossible to raise a family on $5.15/ hour. I just don't understand how this will make it any easier. Businesses that pay these wages will incur an increased cost in labor. In order to offset this cost and remain profitable, they will need to increase prices to make up for the extra cost. Thus, your increase in wage is offset by increased prices and you have no more buying power than what you had before.

In a lot of industries, particular big-box retail (Wal-Mart, Target, etc.) and the grocerey industry, businesses are lucky to have a profit margin of 1 or 2 percent. If you increase labor costs a mere 5%, prices will need to be increased to remain profitable.

Answer 1

Everything is going up in price already, except the pay. It has been 10 yrs since the federal government raised the wage. Have you ever tried to live and raise a family on minimum wage. You can't even pay the rent, let alone feed yourself. Not even 2 incomes at the minimum wage is enough. Even the raise won't be enough to get people out of poverty, but it helps and its about time. As for the idiot that says give a $50 per hour. Try to live on $5.50 per hour, which many people in this country do. That is $880 per month. Most peoples rent is more than that. Groceries alone are at least a couple hundred a month, and thats without kids. Wake up and realize that people are suffering because they can't heat their home, or buy clothes for their kids. When you go through what these people go through, then complain.

What reason have business given in the past for raising prices. The grocery prices alone have increased 10 fold over the past 10 yrs. There is always price increases every year, and not a wage increase. It is about time that business started paying a fare wage instead of filling their own pockets. And if prices have to go up because of the wage increase, then so be it. In this country the Rich get Richer and the poor get poorer. It is about time that the government tried to do something to help the poor in this country rather than big business.

I have seen first hand with some of my husbands relatives what it is like to live on a low wage, and it is almost impossible. The type of work that most of these people have to do is not worth the pay that they are getting.

Costs will also be offset by the fact if people had more $$, they will spend it, thus boosting the economy.

Answer 2

Democrats keep telling people can not live with minimum wages. ok, then why not raise the wages to 50 dollars an hour??? that should solve the problem, right???
can any Liberaal tell me why??

Stay poor, Vote Democrat. this is the answer.

Answer 3

The benefits are political posturing to an economically ill-informed public. That is, unless you consider short-term price spikes, fewer job opportunities and more difficulty for the low-skilled and inexperienced to begin climbing the ladder to success as benefits.

Answer 4

There are no benefits at all except the democrats making themselves look good to the uneducated and uninformed. The rest of us will be paying higher prices for everything while getting poor service (fewer workers) ...

Answer 5

NO. Raising the minimum wage causes employers to eliminate jobs, so it hurst everyone.

http://en.wikipedia.org/wiki/Minimum_Wage