Raising the Minimum Wage to Save the American Dream

The following sample Economics essay is 1494 words long, in APA format, and written at the undergraduate level. It has been downloaded 96 times and is available for you to use, free of charge.

There are a variety of social, political, and economic reasons why the minimum wage needs to be immediately raised on both the state and federal level. The current minimum wage is simply too low to adequately allow workers to support themselves, alleviate their hardships, and improve their financial standing as they attempt to move into the middle class. Furthermore, the minimum wage could easily be raised without causing an increase in the price of goods and services, since it would simply require less money to go into the pockets of large corporate owners who control a vastly disproportionate sum of the earnings of most businesses. Therefore, it is evident that raising the minimum wage is essential to ensure that working-class Americans can support themselves and their families while earning enough money to have realistic access to opportunities to improve their socioeconomic standing. This is an absolutely essential course of action for the protection of the working class throughout the state of Kentucky and the nation as a whole.

The main reason why raising the minimum wage is an issue of such paramount importance is that it is quite simply impossible for many workers to support themselves on the earnings from a minimum wage job. As Zachary Roth states, “A new study by the National Low Income Housing Coalition finds that there isn’t a single state in the union where it’s possible to afford a two-bedroom apartment at the prevailing market rent while working a standard 40-hour week” at the current minimum wage (2012). Kentucky rates as one of the more affordable places to live while making minimum wage, but according to this date the average minimum wage worker would still have to work 65 hours a week to afford a two-bedroom apartment. Known as the minimum effect, the fact that the minimum wage is so low that many workers cannot afford to pay rent despite working full time clearly indicates that there needs to be a serious change in policy surrounding this issue. Full-time workers should not be paid a wage so low they cannot even afford rent, while the corporations they work for rake in profits. This becomes even clearer when the massive inequality of much of the American system is examined in greater detail.

Many corporations and business owners argue that an increase in the minimum wage would cause a rise in the price of goods and services and force them to hire fewer employees. An examination of the data available reveals that this is simply untrue. The facts reveal that, in a telling example, “the Walton family of Wal-Mart, is worth more than the bottom 40 percent of Americans” (“Progressive Budget Blueprint” n.d.). When the owners of a company reliant on minimum wage workers have more money than forty percent of the population combined, it is clear that the proceeds of the company are not being allocated in a manner that adequately rewards the workers who make the company’s success possible. Furthermore, it is evident that raising prices would be unnecessary when a simple redistribution of a higher percentage of corporate profits into the hands of workers would still leave plenty for the owners while keeping prices low. The massive inequality exemplified by the gulf between the earnings of Wal-Mart workers who cannot afford to support themselves and the earnings of the corporation as a whole vividly illustrates the need for an increase in the minimum wage. This assertion is supported by many of the most important economic thinkers who have studied the subject.

Many of the most influential economic policymakers in the country believe that raising the minimum wage is one of the most effective possible methods of alleviating the systematic inequality that has taken over American society. As Annie Lowrey states, “Alan B. Krueger, the departing chairman of the White House’s Council of Economic Advisers, said that raising the minimum wage would undo ‘a lot of the rise in inequality we’ve seen over the last 20 years’” (2013). The support for this course of action from such high ranking economic officials illustrates both the absurdity of the income gap that has gripped American society and the effectiveness of raising the minimum wage in addressing this issue. Clearly, raising the minimum wage is necessary to preserve the equality of opportunity on which America prides itself while ensuring that basic standards of living are available to all American workers. Furthermore, research indicates that raising the minimum wage can be accomplished without any negative implications for workers and businesses.

While business owners argue that raising the minimum wage would damage their ability to do business, the statistics show that this is simply untrue. As Lowrey reports, Krueger, in “his work with David Card of the University of California, Berkeley (later replicated by others) demonstrated in a real-life experiment that raising the minimum wage did not result in businesses shedding workers, perhaps in part because it helped reduce turnover” (2013). Clearly, the idea that raising the minimum wage punishes business owners and stifles hiring is a dangerous and untrue misconception that contributes to the ongoing poverty of millions of Americans. It is extremely important to emphasize that raising the minimum wage is not linked to any reduction in the availability of jobs, meaning that it unambiguously aids the working-class citizens who need help the most. Furthermore, the need for an increase in the minimum wage becomes even more clear when the demographic profile of typical minimum wage workers is examined.

The injustice of the appallingly low minimum wage is only made worse by the fact that it is largely marginalized and disadvantaged groups who are forced to accept these wages. For instance, according to the Bureau of Labor Statistics, “Of the 60,000 workers earning the prevailing federal minimum wage or less in Kentucky in 2012, 42,000, or 70 percent, were women. These women represented 7.2 percent of all women paid hourly rates in the state” (2013, p. 2). The fact that women are vastly overrepresented in the ranks of minimum wage workers further emphasizes that raising the minimum wage is necessary to combat the obstacles facing many working-class women in their attempts to move up in the workforce and earn enough money to help them attain the educational and professional opportunities necessary for socioeconomic advancement. Raising the minimum wage is a necessary step in ensuring that the women of Kentucky and the nation as a whole receive equal pay for equal work that they clearly deserve. Furthermore, this issue is a growing concern as it becomes evident that minimum wage jobs are becoming increasingly prevalent.

Unfortunately, as manufacturing jobs continue to disappear and the current sluggish economy decimates many higher-paying jobs, more and more Americans find themselves working for the minimum wage. As Annie Lowrey states, the recession took middle-class jobs, and the recovery has replaced them with low-income ones, a trend that has exacerbated income inequality. According to Labor Department data, about 1.7 million workers earned the minimum wage or less in 2007. By 2012, the total had surged to 3.6 million, with millions of others earning just a few cents or dollars more (2013).

As increasing numbers of American workers find themselves dependent on minimum wage jobs to support themselves and their families it underlines the imperative nature of ensuring that these jobs pay a living wage. Minimum wage jobs are no longer the domain of teenagers looking to earn extra money but are sadly one of the most important sectors of the new American economy, and it is, therefore, vital to make certain that it is possible to survive and even support a family off the wages these jobs offer. Doing so will likely become more important in the future if the rapid proliferation of minimum wage work in recent years is any indication.

Raising the minimum wage is an absolutely essential measure to ensure that all American workers are able to enjoy a certain basic standard of living. This type of policy measure has been concretely shown to benefit workers and reduce inequality, while not adversely impacting businesses or entrepreneurs. It is especially important to note that given the disproportionate number of women in minimum wage jobs and the increasing number of citizens employed in these fields this is an issue that is growing in importance. A serious increase in the minimum wage is an essential policy measure to ensure the preservation of the American way of life.

References

A Progressive Budget Blueprint. (n.d.). Bernie Sanders: United States Senator for Vermont. Retrieved March 14, 2014, from http://www.sanders.senate.gov/budget/

Lowrey, A. (2013, June 15). Living on minimum wage. The New York Times. Retrieved March 13, 2014, from http://www.nytimes.com/interactive/2013/06/15/business/living-on-minimum-wage.html?_r=0

Minimum Wage Workers In Kentucky–2012. (2013, April 2). Bureau of Labor Statistics. Retrieved March 14, 2014, from http://www.bls.gov/ro4/minwageky.pdf

Roth, Z. (2012, May 31). It's basically impossible to live on the minimum wage. MSNBC. Retrieved March 14, 2014, from http://www.msnbc.com/msnbc/its-basically-impossible-live-the