The idea of increasing the federal minimum wage above the current $7.25 per hour has gained momentum in recent years, as 29 states and a number of major cities have experimented with significantly higher earnings floors while debate over income inequality has taken center stage in the national political discourse. But can the country afford a higher minimum wage, and how many people would this quick fix really help, anyway?
Well, the 2.6 million people whose wages were equal to or less than the federal minimum in 2015 represented only 3.3% of all workers paid by the hour, according to the Bureau of Labor Statistics. And that figure represents a decline from 3.9% in 2014 and 13.4% in 1979, the year such data was first recorded.
Raising the minimum wage might therefore seem to be more trouble than it’s worth, considering that every dollar increase stands to cost Uncle Sam and his loyal taxpayers (us) as much as $5.4 billion per year, assuming all the folks who make the current federal minimum or less work full time. Then again, each extra dollar increases household spending by $700 per quarter, according to the Federal Reserve Bank of Chicago, thus providing a boost to the economy as a whole. We’re also spending $153 billion each year on public assistance programs to support poverty-level workers, according to a 2015 study from the University of California Berkeley Labor Center, and that bill figures to decrease significantly with higher wages.
In other words, there is no straightforward answer in this particular debate. So with that in mind, we posed the question – should the minimum wage be raised? – to a panel of leading experts in the fields of public policy and socioeconomics. You can check out their bios and responses – including nine “Yes” votes and three “Nos” – below. And make sure to share your thoughts in the comments section at the end of the page.
Why The Minimum Wage SHOULD Be Raised
- "Yes, the minimum wage should rise. ... A higher minimum wage will help the lowest-wage earners and reduce overall labor market inequality a bit. ... Having said that, I strongly oppose recent decisions in major cities like Los Angeles, New York and Washington, D.C., to raise the minimum wage to $15."
- Harry J. Holzer // John LaFarge Jr. SJ Professor of Public Policy, Georgetown University
- “As a sociologist, I am concerned with who these workers are and the impact of low wages on families, communities and society. Over 62 percent of minimum wage workers are female and 64 percent work part-time. That means we have a labor force that is highly feminized, under-worked and under-paid – all of which contributes to the feminization of poverty: the disproportionate rate at which women and children experience poverty relative to their male counterparts. Raising the minimum wage more towards a living wage is needed, and long overdue: 7 years overdue, to be exact.”
- Meredith A. Katz, Ph.D. // Teaching Faculty, Department of Sociology, Virginia Commonwealth University
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Why The Minimum Wage Should NOT Be Raised
- “As a policy to mitigate income inequality, increasing the minimum wage is not terribly effective. The reason, of course, is that an increase in the minimum wage does not necessarily raise the income levels of minimum- wage earners. While an increase in the minimum wage raises the wage level for this set of earners, it also reduces hours employed. Faced with a higher minimum wage, some firms substitute toward capital or toward higher skilled labor.”
- Bhavneet Walia // Associate Professor, Falk College of Sport and Human Dynamics, Syracuse University
- "The very people whom we want to see get a firm foothold in employment — teenagers and young adults — are affected disproportionately by the minimum wage, as it does reduce their employment. It’s not a big effect in the labor market as a whole, but it’s there. And the larger the minimum wage increase, the more it will have an effect. Look at the high youth (and overall) unemployment rates in many other countries with higher minimum wages and additional labor market restrictions relative to the US system. As our ambling economic recovery continues, we don’t need to make it harder for new workers to get that first foothold up."
- Joyce Jacobsen // Provost and Vice President for Academic Affairs, Andrews Professor of Economics, Wesleyan University
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