Raise the Minimum Wage to a Living Wage!
For over the past seventy five years, the debate on minimum wage has
been unsettled.This discussion started in 1938, when President Roosevelt signed
the bill called, the Fair Labor Standards Act, which set minimum wages at 25 cents an hour, and full time work hours at 44
hours per week. The cost of living was less expensive then. Looking forward seventy five years, to 2014 the minimum wage has only risen eight dollars. The cost of living for low income workers is harder to bear than it was in 1938, because of new inventions and resources, things are more expensive. For example, to live in a decent home or an apartment,
which may range from five hundred dollars to seven hundred dollars per month, ones income would have to be at least $2,600 per month to be approved. Therefore, low wage workers income would have to be three times the monthly rent. Often times, they have to seek a co-signer in order to have a suitable place to live, which takes away from a sense of independence.
I am a single mother with two children, and I work at Hardees
fast food restaurant in Springfield, IL, making $8.50 an hour, which is not
enough to live on. Living below the poverty level is stressful. Budgeting for a
month is almost impossible because of fluctuating gas prices, the cost of food,
and the cost of housing. Gas prices have not been consistent over the past five
years. One day gas prices are about three dollars per gallon, and then the next
day it may increase to a little over four dollars per gallon, which is half of
what I make in one hour. When I go grocery shopping, I am shocked at the prices
on certain food items. For example, milk has risen to approximately four
dollars within the last five years. There have been several times when I walked
out of the grocery store holding two or three bags, wondering how I spent over
one hundred dollars! Housing has increased over the past five years. In fact,
four years ago I lived in an apartment that was five hundred dollars per month,
now that same apartment complex is charging six hundred dollars per month. This
is just cost of living in Springfield, Illinois, imagine trying to live on a minimum wage in a
major city like Chicago, Illinois.
A low waged worker lives on edge every day, often having to borrow money from loan companies like, Payday Loans or Title Loans. I am one of those people, who has put my pride aside and taken out loans to pay my bills, which puts me further in debt. Also, there have been several months out of the year, when I had to choose if I was going to pay my utility bill or pay my rent, hoping that the companies would understand. Only being able to work to pay bills in the economy is not fair, especially to hard working individuals. It is frustrating that I cannot purchase a car because the first thing a dealership will look at is my income, and witness that I do not qualify to make an affordable payment on the car, which is biased. I deserve to be able to afford things in the economy, in order to help build businesses in Illinois. If the minimum wage is raised from $8.25 an hour to $10.00 per hour, there will be a greater chance that low waged working individuals, including myself, can afford to pay bills, and contribute more in the economy without relying on the Government so heavily.
Vanessa Cardenas, who has a B.A. in government and politics and a master’s in public administration, both from George Mason University, states that a full time worker earning $7.25 an hour makes $15,080 a year and that is $4,000 below the federal poverty line for a family of three. So a full time worker making $8.25 an hour makes $15,840 a year is technically still thousands of dollars below the poverty line, and can barely afford to provide for their families. This is exactly why certain programs are available such as SNAP (The Food Stamp Program) because people cannot make ends meet. Cardenas states that, raising the minimum wage to $10.10 per hour will reduce SNAP programs, producing $46 billion in savings over 10 years. Saving billions of dollars can provide more jobs in the economy and help small businesses afford to pay employees $10.00 per hour.
Many businesses could be affected with the minimum wage going up to $10.00 per hour. Chad Halvorson is the CEO of www.wheniwork.com, which is used by thousands of restaurants, retailers, and healthcare providers all over the world for communication purposes with their employees. On Halvorsons' Website he communicates that if minimum wage was raised, then employers can no longer afford to pay their employees, and must make some layoffs to remain in the budget. Also, if the minimum wage were raised, employers cannot afford to hire as many employees. Indeed this may be true, but if the minimum wage were raised then employees will spend more money in the economy, and businesses will be able to hire more people to keep up with increased sales (Halvorson). Companies want to make a profit, and increasing the minimum wage will be an additional cost that employers will have to adapt to. However, over time more people with more money will help increase companies profits. Kim Maisch, who is the Illinois State Director of the National Federation of Independent Business, claims that business owners are also dealing with high cost of doing business in Illinois, such as workers compensation, unemployment insurance cost, and the impact of Obamacare. If the Government can lower certain cost for businesses, then raising the minimum wage will produce more money, creating a stimulating effect as those dollars spread through the economy (Karp).
On the other hand, things in the economy are still going, and the minimum wage is still set at $10.00 per hour. For instance, McDonald's double cheese burger use to have two pieces of cheese on it for $1.08, now it has one piece of cheese on it and the price has risen to $1.29. Travis Hoium, who has a BA in Mechanical Engineering from the University of Minnesota states that labor cost, input cost from food packaging, and other inputs into the business may increase if the minimum wage were raised to $10.00 per hour. Then it would cost consumers a dime more per dollar spent. Hoium, claims that labor is the second cost component and food cost should be watched more closely than the minimum wage debate. Hoium, also points out that a report by John Schmitt for the center for Economics and Policy Research found that a 10 percent increase in the minimum wage would raise food prices to about 4 percent. Even though some things might have a small increase in the economy, raising the minimum wage will benefit several working individuals and working families in the state of Illinois. Jared Bernstein, former Chief Economist and Economic Advisor to Vice President Joe Biden, states that raising the minimum wage will help. Bernstein argues that an extra dollar earned by a wealthy person is less likely to be spent than an extra dollar earned by a low income person. The rich are not “income constrained” but a low income worker is much more likely to consume their extra dollar of earnings into benefiting the economy (Mantel). That is more of a reason for the minimum wage to be raised to $10.00 per hour. Opponents against the minimum wage disagree.
One concern that people have is that raising the minimum wage would affect teenage workers. Aspen Gorry and Sita Nataraj, both with degrees in Economics state that the minimum wage will affect young workers between the ages of 18 to 25. Employers may not feel the need to pay a young inexperienced worker above $8.25 per hour, so therefore, it might be some job losses among them. The harm done if minimum wage increases gets compounded for young workers because it prevents them from gaining experience, thus increasing chances of being unemployed in the future (Gorry and Nataraj). It is a better chance that businesses will keep their employees over the age of 25, and hire people that are 25 years of age. I do agree that business may not want to pay $10.00 per hour to a young inexperienced worker, due to the fact that they might not have enough qualifications to earn that much. For example, some jobs hire based off how long an individual worked in their past years, and how many jobs an individual has held in their past years. At the ages between 18 to 25, I am sure that a long resume would not be the case. Some teenagers are still living with their parents, and might not have as many responsibilities to incline like others. In spite of the fact that some opponents might not agree with the minimum wage going up, there is a helpful way to start spreading money through out the economy without effecting the wealthy. As a number of other countries do, like the Netherlands, they have a separate minimum wage level for each age between 15 and 23, meaning that employers start off at the bare minimum, and their earnings increase as they get older, and gain more experience in the workforce. If the state of Illinois can exempt individuals under the age of 25 from the minimum wage, as a number of other countries do, then companies will have money to pay their employees and still make profits (Gorry and Nataraj).
Furthermore, raising the minimum wage to $10.00 per hour will reduce turnover rates. Low waged workers will appreciate their jobs more if being paid more. A day at work for me at Hardees are non stop duties, including, detailed cleaning, cooking, and dealing with customers every hour. One night, my manager Rob told me to clean the legs of 32 chairs in the lobby, which is a total of 128 legs. He then wanted me to take pictures off my cellular phone, and send them to him for proof that I cleaned all of the legs of the chairs. I thought it was quite ridiculous! Being paid only $8.50 per hour and having to do all of that work is not enough. If I was paid $10.00 per hour, I would enjoy my job because my duties will be worth the earnings. I want to be able to afford to pay my bills, get approved for a car, approved for an apartment without needing a co-signer, and feel like I am apart of this economy, and not living in poverty even though I am working. I want to be able to walk out of the grocery store with more than two to three bags, so I can feed my children and I for the rest of the month. Additionally, more than 600 economist, seven of them Noble Prize winners in economics, have signed onto a letter in support of raising the minimum wage to $10.10 per hour by 2016. Raising the minimum wage in the State of Illinois will not alleviate poverty,but it will contribute to the economy, give low waged working individuals a chance to make ends meet, and provide for their families
Citations:
-Hoium. Travis. “What Will a Minimum Wage Increase Cost You at McDonald's?” The Motley Fool. www.fool.com. 08 Jun. 2014 Web. 21. Oct. 2014.
-United States Department of Labor. Office of the Secretary. “Minimum Wage Mythbusters” www.dol.gov/minwage/
-Cardenas. Vanessa. “The Benefits of Increasing the Minimum Wage for People of Color.” www.americanprogress.org 21. April. 2014 web. 22. Oct. 2014.
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