Read this paragraph and write a summary. (What you like about it, what you know about it, or if you agree, etc.) MAKE SURE THAT YOU ADD SOMETHING NEW to the discussion.
Market Impact of the new federal minimum wage
Currently, in the United States, the minimum wage for workers is $7.25 per hour and it has remained constant for over 10 years. This means many residents in the United States have to work for two shifts or more than one job to secure a decent income and have a standard lifestyle. Fortunately, the Wage Act of 2021 has helped to pass the new increase of minimum wage to $15 per hour. The Act would majorly help to eliminate the poverty level in the United States and help many workers secure decent pay (Weaver, 2021).
How will the proposed increase help workers and which parts of the labor market would be helped?
The raise wage act of 2021 which proposes a minimum wage of $15 per hour by 2025 would help raise the earnings of more than a 32million workers. The most affected workers would be those who work year-round which means their annual pay would increase by $3,500. For instance, the increase would help nearly one in every three African American workers which are approximately 31% and one in every four Hispanic workers 26% compared to the one in every five white workers. The effect would help bring racial equity to America (Weaver, 2021). Therefore, the Black and Hispanic workers who work year-round would have their annual pay increased by $3,500. Besides the raise would help increase the wages of more than a 19million essential and front-line workers. Additionally, workers who cannot work from homes like Blacks and Native Americans would receive a pay raise.
Which part of the labor force would be hurt?
The proposed minimum wage has sparked several debates on the benefits and consequences to the workforce. Most affected individuals by the rise in the minimum wage would be small businesses and business owners. This is because many businesses suffered losses and blows from the Covid-19 effect and now the raise would mean that they increase the minimum wage paid to their employees. It can eventually lead to the closure of many small businesses because they would not be able to afford to pay employees.
Effect on prices of goods and services produced at minimum wage labor
The prices would increase to compensate for the cost of production. An increase in the minimum pay for workers would mean employees would spend more on human resources forcing the prices of commodities to increase to compensate for the money used to pay the works and to meet their profit levels.
In conclusion, the proposal is a good idea because it would help eliminate the poverty level in The United States by ensuring that more low-wage workers are paid enough to cover their basic needs (Weaver, 2021). The wage would be able to provide a modest and adequate standard of living for many Americans.
