The Pros and Cons in the Debate Over Raising the Minimum Wage

From Capitol Hill in Washington, D.C., to statehouses across the United States, a serious debate has been ongoing for some time about raising the minimum wage. Indeed, the debate has filtered down to city halls across the country as well, not to mention among friends and families who have people employed in minimum wage jobs.

Understanding the intensity of the debate, there have been some more commonly propounded arguments in favor of increasing the minimum wage. Conversely, there have been some common arguments put forth in opposition to increasing the minimum wage.

Pro: Improve Living Standards

The most fundamental argument made in favor of increasing the minimum wage is that a raise in it would improve the standard of living of millions of people in the United States. The nonpartisan Congressional Budget Office consistently has reported that an increase in the minimum wage would lift at least a million, and perhaps as many as 5 million, workers above the poverty threshold. The number of workers taken above the poverty level depends on the amount the minimum wage is increased.

As an aside, a related benefit to lifting people out of poverty by increasing minimum wage is that fewer people would need to access federal and state sponsored financial assistance programs. In other words, an increase in the minimum wage would not only lift potentially millions of people out of poverty, it would work to save taxpayers money as well.

Pro: Boost Worker Morale


Another benefit associated with increasing the minimum wage is a boost in worker morale. Paying workers more for their efforts very well may entice them to “give their all” when it comes to efforts on behalf of their employers.

In addition, by increasing the rate of pay, more employees might be willing to remain in a position of employment for a longer period of time. Experienced workers adds a level of value to the overall operation of a business.

Pro: Increase Consumer Spending

A third, commonly made argument in favor of increasing the minimum wage is that it puts extra money into Americans’ pockets. Upwards to 17 million Americans might benefit from a nationwide increase in the minimum wage.

A significant percentage of the amount of money paid to workers via a minimum wage increase would return fairly quickly back into the marketplace through purchases these individuals will make for themselves and their families. Hopefully, some of this money would also be saved. However, the bulk of the increase is likely to go towards buying goods and services for these workers and their loved ones.

Con: Businesses Will Raise Prices

The most commonly made argument against raising the minimum wage is that the net effect of doing so will be to increase the costs of goods and services. In other words, if the minimum wage is increased, the typical business is going to pass the cost of the increase on to their own customers or clients.

We are living in uncertain economic times. Even seemingly more minimal adjustments in the costs of goods and services can have a resulting negative impact on the economy overall.

In addition, many of the workers who receive a wage increase would face an issue with more costly goods and services. They will end up as part of the population who ends up paying more for goods and services as a result of costs past through to consumers by the very businesses that employ these workers.

Con: Jobs Will be Cut

A second negative consequence of raising the minimum wage is that some employers will cut jobs to make up the cost associated with meeting a higher minimum wage. Some people opposed to raising the minimum wage suggest we are already seeing this in the form of kiosks in fast food restaurants and self checkout stands in grocery stores.

Employers may also look at eliminating employee benefits as a means of making up for the costs associated with an increase in the minimum wage. In this day and age, many employers don’t offer much in the way of benefits anyway. But, employees could lose such things as paid vacation.

Con: Reduced Desire for Career Advancement

Many minimum wage jobs historically have been starting points for people entering the workforce for the first time. From these positions of employment, many people move forward and seek other types of jobs that pay more or offer a greater degree of benefits. One argument against raising the minimum wage is that at least some employees would lose their desire for career advancement.


Jessica Kane is a professional blogger who writes for Faxage a leading company that provides Internet fax service for individuals and businesses.


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