why are american minimum wage levels so low?

Question

i was just wondering because i just read that:

As of January 2007, the US federal minimum wage is $5.15/hour.

but where i live it's

The current federal minimum wage for full or part time employees aged over 21 in Australia is AU$13.47 (~US$10.50) per hour

i thought america was the biggest most powerful richest blah blah blah?

Answer 1

because corporations have huge political influence here.

higher minimum wages would cut into their profits, so they spend tons of money to influence congress not to pass minimum wage increases.

Answer 2

Because the powers that be (government and business) always think that businesses would go under if the minimum wage was at a decent level. Many local community leaders have been fighting for a "living wage" for several years now. In some cases certain jobs such as local government jobs are paid at $4 or $5 an hour above the federal minimum wage. How can anyone live on $5.15 an hour is beyond me and worse how can any decent business person offer such a low wage.

A dishwasher in a restaurant for an example, earns minimum wage and I believe people who own restaurants object to having to pay someone 9 or 10 bucks an hour for a dishwasher job.

Answer 3

Lets see, how can I explain it? It’s late and bed time but your question then comments peed me off a little. Only because you don’t understand.. So I’ll try to explain before the sandman takes over..

Most company’s pay well above minimum wages. Which is now $7.25 per hour. A $2.10 per hour increase. So, this is great for anyone making below $7.25 They get an awesome pay raise! However, we run into some problems. The employer’s payroll has now increased. How do you think they’re going to make up for the loss?
- Layoff workers. Maybe
- Hire only part-timers. Most likely
- Increase employee health care co-pay? You bet!
- How about the most obvious? Raise the price of their product.

-The manufacture will charge .20 cents more for the product. To cover the minimum wage increase.
- The disturber will tack on another .20 cents
- The company selling the product will tack on another 20 cents to cover their end.

So now, you the consumer, will be the one paying for the minimum wage increase.
That $1.50 gallon of milk is now $2.10. 60 cents more. In some cases it could go up an additional dollar.

The wage hike is great, but at the same time.. its going to hurt alot of people!

lol I know this was a weak answer and not very detailed, but I hope you understand!

Answer 4

First the United states enjoys the highest standard of living in the world. Second your post ignores basic economic realities. In order to properly address any wage differences between countries you also need to address the tax burden and cost of goods and services. In both instances if you compare any of the countries you mentioned to the United States they will come up short. It is easy to seize on one number to make a weak case, but for real comparison you have to address all of the numbers. Here is a simple fact. Increases in minimum wage are accompanied by increases in the cost of goods and services as well as reductions in new job creation. Sure you can get paid 10 dollars an hour minimum wage, but how does that benefit you if you have to pay 4 dollars for a loaf of bread? Companies will not just absorb extra costs of doing business, they instead pass it along to the consumer. Minimum wage is not designed to be a living wage and never was. It was designed to set a minimum standard for workers entering the workforce. I agree with a previous poster that if you are an adult over 25 and you are working for minimum wage, you lack either job skills or the ability to stick with a job long enough to advance.

Answer 5

Right now we are still Republican controlled. They tend to side with big business.

In the state I live in the Democrats just took over and raised the wage to 6.85 (whoop-dee-doo)

Yes we are the biggest most powerful and richest....but 30% of us are living below the poverty line. 70% are living paycheck to paycheck and could risk homeless after missing just 2 paychecks. All this wealth is held by a small number of Americans. I heard once the 99% of the wealth is held by the top 1%. Wish I could site a reference for you but look it up.

Answer 6

They want to raise it Gradually to $7.25 by 2009!!! Workers have not had an increase since 1997!! Are we suppose to be grateful now for waiting 12yrs for a living wage? The increase amounts to 17.6 cents an hour for 12 yrs of waiting for the increase in our hard earned paycheck! 12 yrs** DO THE MATH!! Would you work for12 yrs for 17.6 cents an hour? * Thats Insane*! THANKS FOR NOTHING!! MAY GOD HAVE MERCY ON OUR SENATORS AND REPRESENTATIVES!!!!!!

Answer 7

it was just increased to ~$7, (whoo hoo)
It's sad.

Answer 8

it depends on what state you live in.
http://www.dol.gov/esa/minwage/america.htm