Can an Increase in Jobs Pay Change Society and Crime Happening in Todays Life - Essay Example

Student’s Name Instructor’s Name Course Name Date of Submission Can an Increase in Jobs Pay Change Society and Crime Happening in Today’s Life America is amongst the countries that experience many social problems that affect the wellbeing and the security of its people. Among the social problems that America is grappling with include high crime rates and high rates of unemployment. In order to fight some of these social problems in the society, there has been a proposal for an increase in the wage rate in the country. This follows studies that have showed that wage rates have a direct link to some of the social problems that America faces today. The U.S. federal minimum wages was set in 1938 during the Great Depression. At the time, the minimum wages allowed was only 25 cents (Cantor and Land 318). The minimum wages was later adjusted to $7.25 per hour, where it currently stands to factor in inflation and the cost of living. Because of the rising cost of living, President Obama recently proposed an increase of the minimum wages that has remained constant since 1968 to $9 per hour. So far, President Obama has raised the minimum wage rates to $10.10 per hour for all federal contracts (Strasser par. 3). Most states have also increased their minimum wage rates to as high as $15 per hour. However, the question that abounds has to do with whether or not increasing the pays of employees change the society and crime that happens in the society today. This discourse will discuss the impact of an increase in the worker’s pay on the society today, with a particular focus of its impact on crime rates. America’s economy has recorded a significant growth in the past few months after years of decline and stagnation. It is believed that the standards of living of the American people has improved significantly due to the falling rates of unemployment, falling inflation and the strengthening of the dollar against world’s major currencies that has promoted trade (Allan, and Steffensmeier 107). Despite all these achievements, America still faces serious social problems that impacts negatively on the people. Amongst the greatest social problems that America is grappling with is the high crime rate. Currently, America is the leading country in terms of homicide rates. At the same time, America also experiences high rates of other forms of crimes including robbery, property crimes, street gangs and drug trafficking among other crimes. Therefore, in order to fight the high crime rates in the country, raising the wages of employees has been cited as one of the best solutions. This follows certain body of research findings that have shown that raising the pay of workers can help reduce the rate of crime in the society. One such study was that conducted recently by Ohio State University that found that low wages was a major factor that forced many un-educated men to engage in crime. The study was conducted in 1997 and involved and 1997, where the researchers analyzed the rates of crime in the country (Ohio State University par. 3). The researchers found that the crime rates in the country were higher during periods of low wages and unemployment among the un-educated men. Precisely, the researchers observed that, from 1979 and 1997 when the wages for the un-educated men fell by 20%, violent and property crime among these men increased by about 21% and 35% respectively (Ohio State University par. 6). From the study, the Ohio State University researchers noted that money was often a motivation for people to engage in crimes such as property crime, robbery and assault Ohio State University par. 8). This study was supported by the National Bureau of Economic Research (NBER) that found that an increase in the youth wages resulted in low crime rates. From the study, the researchers estimated that an increase in the wages by 10% resulted in a reduction in the crime rates by between 6% and 9%. Like the Ohio State University researcher, NBER researchers also observed that money is a motivating factor for crime. According to NBER, most people are tempted to engage in crime when they believe that what they earn is not enough to sustain them and their families (par. 7). As such, an increase in the pay means more income, which results in a reduction in the crime rate. In justifying the correlation between wages and crime rates, NBER analyzed how wage disparity contributes to the difference in crime rates between different races in the country. The disparity on the wages and crime rates involved comparing blacks and whites. In terms of crime rates, the NBER researchers found that the rates of Blacks involvement in crime was one-third more than whites (par. 9). Accordingly, the researchers concluded that Blacks were involved more in crime than whites because they earn less compared to their counterparts. This, therefore, meant that the differences in crime rates are partly attributed to the labor market phenomenon. In fact, President Obama relied on these researches that have found that an increase in wages results in a reduction in crime rates to propose an increase in the minimum wages. According to Obama, increasing the minimum wages is necessary because it will result in an increase in the purchasing power of American households for those earning the minimum (Strasser par. 8). This would, in turn, stimulate economic growth due to the increase in consumption and employment creation. The end result is that more jobless youths will get employed, thereby resulting in a reduction in the rates of crime (Downes 397). In fact, some economists have supported the idea citing that the rate of crime in the country has been decreasing since the government increased the minimum wage earned by its population, something that has helped stimulate economic growth, increased consumption and jobs. Despite the prove provided by the studies regarding the effectiveness of pay rise in making the society better by increasing the purchase power of individuals, as well as increasing job creation, the majority of economists, however, have rejected the findings of these studies. The majority of economists do not believe that pay rise make the society any better or helps in tackling crime in the society. Accordingly to the majority of economists, increasing the minimum wages or pay of workers has harmful effect on the economy, which is bad for the society. They argue that an increase in pay has an inflationary effect in the sense that it triggers an increase in the cost for businesses, which in turn, results in an increase in prices for basic commodities (Strasser par. 5). Accordingly, the economists who hold this view state that the inflationary effect triggered by an increase in the pay of workers only makes life difficult for the rest of the population since it makes the prices of basic commodities to rise to a level that cannot be afforded by low income earners. As such, they are strongly opposed even to the idea of President Obama of increasing the minimum wages for federal contractors arguing that such a move will do more harm to the economy than good. The economists have also rejected the argument that increasing the pay of workers will result in job creation. Instead, the mainstream economists claim that making such a move is detrimental to the society like America that is still struggling to create jobs to its population. They argue that increasing the pay of workers will result in significant job loss that are currently available for the unskilled workers since the move will force businesses to substitute the higher cost employees with capital investment. In fact, the economists have linked the 18% unemployment rate among youths presently to the increase in the minimum wages implemented recently (Downes 395). The rise in unemployment among the unskilled laborers will prove detrimental to the society since it will trigger an increase in crime rate among the unskilled laborers, according to mainstream economists. In conclusion, the debate as to whether or not increasing the pay can make the society better and reduce crime rates today has been going on for many years now. However, from the literature, it becomes clear that opinion is divided as to the effectiveness of pay increase in transforming the society. Some studies have showed that an increase in the pay or minimum wages can be beneficial to the society as it has the effect of decreasing the crime rates in the country. Additionally, some people, including President Obama has supported the idea of increasing the minimum wages as a means of increasing the purchasing power of American consumers, increasing consumption, creating jobs and minimizing crime rates. However, mainstream economists have rejected the claims maintaining that increasing the pay of workers would do more harm than good to the economy by triggering inflationary effect, increasing joblessness and crime in the country. Therefore, it would be highly necessary for policy makers and employers to consider both the pros and cons of increasing the pay before taking any action. This is because, as much as the increase in pay might help change the society by making it better and reducing crime rates, it might also have detrimental effects on the economy. Works Cited Allan, Emilie Andersen, and Darrell J. Steffensmeier. "Youth, Underemployment, and Property Crime: Differential Effects Of Job Availability And Job Quality On Juvenile And Young Adult Arrest Rates." American Sociological Review 54.1 (1989): 107-123. Academic Search Complete. Web. 30 June 2015. Cantor, David, and Kenneth C. Land. "Unemployment And Crime Rates In The Post-World War Ii United States: A Theoretical And Empirical Analysis." American Sociological Review 50.3 (1985): 317-332. Academic Search Complete. Web. 30 June 2015. Downes, David. "Counterblast: What Went Right? New Labor And Crime Control." Howard Journal Of Criminal Justice 49.4 (2010): 394-397. Academic Search Complete. Web. 30 June 2015. NBER. Higher Youth Wages Mean Lower Crime Rates. Web. 7 July 2015 http://www.nber.org/digest/nov97/w5983.html Ohio State University. Higher Crime Rate Linked To Low Wages And Unemployment, Study Finds. Web. 9 July 2015 http://researchnews.osu.edu/archive/crimwage.htm Strasser, Annie-Rose. How Raising The Minimum Wage Could Reduce Gun Violence In Chicago. 22 February 2013. Web. 9 July 2015 http://thinkprogress.org/economy/2013/02/22/1626831/chicago-wages-gun-violence/ Read More

In justifying the correlation between wages and crime rates, NBER analyzed how wage disparity contributes to the difference in crime rates between different races in the country. The disparity on the wages and crime rates involved comparing blacks and whites. In terms of crime rates, the NBER researchers found that the rates of Blacks involvement in crime was one-third more than whites (par. 9). Accordingly, the researchers concluded that Blacks were involved more in crime than whites because they earn less compared to their counterparts.

This, therefore, meant that the differences in crime rates are partly attributed to the labor market phenomenon. In fact, President Obama relied on these researches that have found that an increase in wages results in a reduction in crime rates to propose an increase in the minimum wages. According to Obama, increasing the minimum wages is necessary because it will result in an increase in the purchasing power of American households for those earning the minimum (Strasser par. 8). This would, in turn, stimulate economic growth due to the increase in consumption and employment creation.

The end result is that more jobless youths will get employed, thereby resulting in a reduction in the rates of crime (Downes 397). In fact, some economists have supported the idea citing that the rate of crime in the country has been decreasing since the government increased the minimum wage earned by its population, something that has helped stimulate economic growth, increased consumption and jobs. Despite the prove provided by the studies regarding the effectiveness of pay rise in making the society better by increasing the purchase power of individuals, as well as increasing job creation, the majority of economists, however, have rejected the findings of these studies.

The majority of economists do not believe that pay rise make the society any better or helps in tackling crime in the society. Accordingly to the majority of economists, increasing the minimum wages or pay of workers has harmful effect on the economy, which is bad for the society. They argue that an increase in pay has an inflationary effect in the sense that it triggers an increase in the cost for businesses, which in turn, results in an increase in prices for basic commodities (Strasser par. 5). Accordingly, the economists who hold this view state that the inflationary effect triggered by an increase in the pay of workers only makes life difficult for the rest of the population since it makes the prices of basic commodities to rise to a level that cannot be afforded by low income earners.

As such, they are strongly opposed even to the idea of President Obama of increasing the minimum wages for federal contractors arguing that such a move will do more harm to the economy than good. The economists have also rejected the argument that increasing the pay of workers will result in job creation. Instead, the mainstream economists claim that making such a move is detrimental to the society like America that is still struggling to create jobs to its population. They argue that increasing the pay of workers will result in significant job loss that are currently available for the unskilled workers since the move will force businesses to substitute the higher cost employees with capital investment.

In fact, the economists have linked the 18% unemployment rate among youths presently to the increase in the minimum wages implemented recently (Downes 395). The rise in unemployment among the unskilled laborers will prove detrimental to the society since it will trigger an increase in crime rate among the unskilled laborers, according to mainstream economists. In conclusion, the debate as to whether or not increasing the pay can make the society better and reduce crime rates today has been going on for many years now.

However, from the literature, it becomes clear that opinion is divided as to the effectiveness of pay increase in transforming the society.

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