The Workers Plight - Essay Example

The Dilemma of Raising the Minimum Wage Rate As the midterm elections loom, the US Congress finds itself in a confusing version of the customary posturing gridlock. The Congress finds itself in a likely situation of, not addressing some urgent issues, which have cropped in the past half. Among others, the matters of concern are gun control measures, the immigration reforms, the Keystone XL Pipeline, the federal minimum wage, and the export-important bank case. There has been a bill seeking to raise the minimum wage bill from the current $ 7.25 to $10.10 per hour in the next two years (Finnegan 1). Because there has never been an indexed comparison of the federal wage bill to the cost of living, the debate concerning its morality and efficacy are inevitable. There are those individuals who would see the announcement by the president as good news while others cannot welcome the move. In this work, there is a discussion of some of the comments made regarding the likely effects of raising the minimum wage bill. The work concentrates on a dismissal that increasing the wage bill will help the poor to raise their standards of living. Considerably, the views of those who advocate the rise hope that the low skilled job entrants will gain a strong bargaining point for the future. The Workers’ Plight The grievances of the workers are simple and clear; few benefits if any, low wages and the pressure of working full-time. Considering the levels of inflation in the country, gains by the workers get is higher than the situation was, a decade ago. On a careful analysis of the situation, the wage rate is still lower than what it was in 1968 (Strain & Hasett 1). In 1968, the rate of inflation was lower than the current figures and the matters grow worse because most of the jobs are part-time. The worst hit sector is the first foods, which provides a significant employment rate for the majority of job entrants. The work done by workers in the first foods companies is not worth the pay (Surowiecki 1). They spend much of their time caught up in hectic procedures to serve customers at the pick hours, with little benefits. The low-income earners in America provide about 46 % of the family income today. It means that they have a pressure of sustaining a relatively large number of dependents on low income (Strain & Hasett 1). The high cost of living is among the leading causes for president Obama’s position concerning the minimum wage rise. If everyone were to have a similar perspective of the situation, then there is a justification to implement an increase in minimum wages. However, there is much to consider before passing the bill. The effects of raising the wage rate have implications that are more negative on the economy in the future than what most of the people may consider advantageous. The first consideration is the idea that raising the wage rate will make it more expensive for the firms to hire workers than the current state (Clemens & Michael 3). Raising the pay rate will have a long-term effect of increasing the number of unemployed workers who may find jobs. Those who retain their jobs will earn more while those who shall lose theirs or fail to get employment will suffer. Research publications by Richard Burkhauser and Joseph Sabia in 2010 revealed a negative implication of a rise in the wage rate (Strain & Kevin 1). According to the publication, if the government were to raise the pay rate from $7.25 to 9.50 per hour, about 11.30 percent of the beneficiaries of such reforms come from the poor families. The first argument for such a conclusion is that most of the poor households in America do not work and, for this reason, they will remain unaffected by the reforms. The second idea is the fact that most of low-wageworkers are not the primary earners in their households. Information originating from the Bureau of Labor Statistics shows that most of the workers in this category live with their families or college students trying to earn extra money. The proportion of the workers below 25 years form only 20 percent of the labor force but account for half the number of the low-income earners. There is a confirmation that the proposal will not benefit the poor (Strain & Kevin 1). Arguing for the revision of the wage rate weakens when people consider better ways of channeling money to the poor families in the country. For instance, Congressional Budget Office has a finding that if the income tax credit increased, there would be better chances of increasing income to middle-class families. Such a method is highly efficient than the conventional way sought after by the majority because it is not politically palatable. The system would take more out of the federal coffers directly, unlike the wage rise, which will not affect the government accounts directly (Brenberg 1). Conclusion The move by the Congress to raise the minimum wage rate is unjustified because of different reasons. First is the idea that it will make the cost of labor expensive for firms operating in America. If such an argument holds, then it implies that a high percentage of the unemployed Americans will not find jobs. At the same time, the companies will have to retrench some of the workers so that the remaining can suit the prevailing wage bill. The move will not help to relieve the rate of poverty among the already poor households. It is true because the poor families do not have a competitive representation in the workforce. The government should seek methods, which will help to address the poverty levels in the country considerably because of the ever-rising cost of living. To match the current rates of inflation and the costs of living in the cities across the nation requires empowerment of the people against poverty. The best and most apparent method, which I propose instead of the wage rise, is an increment in the number of job opportunities. Jobs created should also target the poor in terms of skills, which will ease the current poverty status. Works Cited Brenberg, Brian. Why We Shouldnt Raise the Minimum Wage. CNBC. 16 Jan. 2014. Web. 4 Feb. 2015. . Clemens, Jeffrey, and Michael, Wither. The Minimum Wage and the Great Recession: Evidence of Effects on the Wage Distributions, Employment, Earnings, and Class Mobility of Low-Skilled Workers. Mimeo, September 2014. Finnegan, William. Demonizing the Minimum Wage. The New Yoker. Web. 4 Feb. 2015. . Strain R. Michael, and Kevin A. Hasett. Why We Shouldnt Raise the Minimum Wage. Los Angeles Times. 10 Mar. 2013. Web. 4 Feb. 2015. . Surowiecki, James. The Pay Is Too Damn Low. The New Yorker. 12 Aug. 2013. Web. 4 Feb. 2015. . Read More