Minimum Wage Rates Impact On America - 2305 Words

Minimum Wage Rates Impact Christopher W. Thomas Liberty University Global Economic Environment BUSI-620 Dr. Nesli Duda Introduction Also referred to as living wage, minimum wage is the lowest hourly rate allowed by federal law to be paid to an employee by an employer that is usually determined by inflations and other economic factors. Usually, it is an economic program stipulating an employee’s benefits of working per hour valued against a hardship policy instigated by the employer. In the United States, the minimum wage first came to light during the Depression era which has propelled from levels of 25cents to $7.25 per hour since 1993 (David, 2013). Irrespective if this steep increase, matters inflation in the†¦show more content†¦In essence, this paper thus seeks to purport that raising the minimum wage would increase disposable income while at the same time encourage the country’s inflation and push the unemployment rate to new levels. Clearly, to some extent raising the minimum wage is both an economic and social safety for all those involved but at the same time has crippling effects on the government’s economy and those involved at large. Minimum wages impact on employees Each year that the minimum wage figures stay stagnated at a specific number in nominal dollars, the reality of inflation slowly bites in as its real value is gradually adjusted and in the long run minimum wage earners are left with payments that cannot sum up or fulfill their household and other personal needs. On analysis of this fact, it is evident that the well-being and living standards of minimum wage workers is highly threatened especially for those people who have families and in this earning bracket. Currently, at a minimum wage rate of $7.25 per hour on a full time basis does not necessarily negate to the fact that they get to cross the estimated government poverty line on an all rounded annual basis. Comparing the current status and the 1960s value rates, the wage income is not enough to cater for the needs of a woman together with her family simply