Take for example a pot of water that is heating. If you leave your hand in there while it is warming up, you adjust to the gradual change easily. However, if you wait for the water to get very hot then stick your hand in the pot, it will sting badly potentially causing long term burns to deal with. This same scenario applies to the argument for raising the minimum wage. Typically, it is raised very slowly to avoid any consequences. The wage is currently $7.25, but there are many proponents on the Left that want a fairly quick, if not immediate, increase to between $12 and $15 dollars per hour. As the Left promotes this, they disregard the negative impacts in favor of a quick way to appeal to low wage voters by simply saying nothing but positive things about it. I’ll explain the negative results of a new mandate like this and show that the minimum wage is meant to be a temporary entry level position.
The first negative impact of a substantial wage increase is that it forces companies to cut excess workers. A study by the Congressional Budget Office tested two possible mild increase scenarios compared to what the Left is proposing. Raising the minimum wage to $10.10 or to $9.00. The report concludes that there are distinct trade-offs. Under the $10.10 scenario, there would likely be a reduction of about 500,000 workers across the labor market, as businesses shed jobs, but about 16.5 million low-wage workers would see substantial gains in their earnings in an average week. Under the $9.00 scenario, the labor force would see a reduction of 100,000 jobs, but an estimated 7.6 million low-wage workers would see a boost in their weekly earnings. You can see the cuts to jobs increases exponentially with every dollar added to the minimum. A $15 dollar minimum would cost millions of jobs at a time where true unemployment is at a high. Another way companies would have to compensate for the wage increase is by raising the cost of goods and services resulting in inflation. People that are already making above minimum wage will only be affected negatively. Some would drop out of the middle class. In reality, the compensation would be a combination of job losses and inflation combined.
Aside from the factual economic impacts, there are other logical aspects to look at. Half of the workers at the minimum wage level are between 16-24 years old. Many of these people are high school and college students. Do you think they need a wage to support them as a lifelong career or a wage to just get them from schooling to a better job? Students aren’t raising families last time I checked. These jobs are meant to be entry level positions. As for the people trying to support themselves or a family with an entry level position, you have options usually. I’ll first note that you shouldn’t make the foolish mistake of having kids before you are financially able to. Knowledge and additional skills training is the key to rising the economic ladder. Men have a slight advantage in that they can pursue trade schools. Women can also pursue secretarial positions though. Many people also work two jobs to make up the difference in what they need to support themselves. The central theme is that if you cannot or choose not to utilize higher education as a means of making substantially more money compared to the minimum wage, you have to work hard physically. Don’t rely on the government to simply raise the minimum and effectively penalize everyone else. Someone working fast food with zero skills should not make the same amount as someone with trade skills. Someone with trade skills shouldn’t make the same as a nurse and so on as you ascend the ladder. If you are working hard physically but are unable to support yourself, then I fully support you receiving welfare so long as it’s a helping hand up and not a hand out. Remember that the key to economic success is knowledge and skills not government mandates that produce inflation and turmoil.