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Argumentative Essay on Minimum Wage

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Minimum wage: Is minimum wage really sufficient? Working for minimum wage does not give

people a living wage

In recent years, the minimum wage issue has increasingly become highly polarized and

heated debate. The cost of living has continuously risen and many people argue that the current

minimum wage is not sufficient, as well as working for minimum wage does not give people a

living wage since it is not sufficient to support people and their families (Carr 119). As a result,

they would prefer an increment on the minimum wage. On the other hand, some people believe

that increasing the minimum wage can lead to adverse effects on small and micro enterprises and

the whole economy (Hanke 34). Intrinsically, this essay will present arguments for and against

why the minimum wage is not sufficient considering different historical and social contexts,

various theories and research, and the possible impacts on various sectors of the economy.

The question, “Is minimum wage really sufficient?” should be examined on different

perspectives to better understand the complication surrounding the increasing debate on the

minimum wage, as well as considering certain policy changes that can help address workers and

businesses’ needs in today’s economy (Primer 44). In short, it can be deduced that the minimum

wage is not sufficient to give people a living wage since it does not meet basic living expenses,

aggravates economic inequality, as well as leaves no choice but to demand for social security,

underscoring the instant need for the reexamination of wage related policies for the sake of

workers’ financial stability and dignity. In reality, the minimum wage is not sufficient and should

be raised beyond the current rate.

The minimum wage debate is not a new one and not the first to happen. Indeed, it has

been a discussion issue over several decades. The first United States Federal minimum wage was

established in 1938, which was under the Fair Labor Standards Act (Croflon, Anderson amd
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Rawe 447). Since then, the minimum wage has become an obvious contentious point among

economists, policymakers and workers’ rights advocates (Croflon, Anderson and Rawe 447).

The current U.S federal minimum wage is at the rate of $7.25 per hour, which has not been

increased since 2009 (Gregory and Zierahn 26). Many people argue that this minimum wage is

not sufficient to enable a decent living standard, particularly in places like towns with high costs

of living. Whereas, people against increasing the this minimum wage argue that it could results

in detrimental effects, such as job losses, high levels of inflation and other devastating effects on

the overall economy (Wang 1399). As a result, these differing opinions contribute immensely to

an ongoing and contentious debate concerning the potential remedial action about the minimum

wage policy.

To delve into this topic, it is imperative to understand different research and theories that

have been supporting and opposing raising the minimum wage. For instance, supporters of

raising minimum wage always point to various studies indicating that increasing wages can

reduce poverty by increasing consumer spending and improving the overall workers’ well-being.

The current minimum wage is not enough to live a decent life. The average cost of living in the

United States with exclusion of discretionary expending is approximately $50,000, which is

more than the earnings of the minimum wage worker (MaCurdy 500). The Congressional Budget

Office report in 2014 indicated that raising minimum wage from $7.25 to $9.00 would get about

300,000 Americans out of poverty, whereas increasing to $10.00 would get 900,000 Americans

out of poverty (Congressional Budget Office). According to McAtee, based on the current

inflation, the minimum wage should be at least $10.52 depending on where people are living

meaning that poverty rate could drop even to lower level with an aggressive increase in

minimum wage (25).

Raising minimum wage would help individuals and families to survive diligently and

help the taxpayer burden. Barack said, “We should raise the minimum wage so that no one who

works full time has to live in poverty” (Hanke 45). The Center for American Progress in 2014

reported that increasing the minimum wage from $7.25 to $10.10 would reduce the SNAP

expenditure by $4.6 billion (Congressional Budget Office). Similarly, The Economic Policy

Institute noted that raising the minimum wage to $10.10 would make about 1.7 million people

not to depend on government assistance programs (Hirsch 369). It implied that the annual

government expenditure on support programs would save $7.6 billion because of the minimum

wage increase to $10.10 (Hanke 37). It implies raising the minimum wage would be beneficial to

individual workers and their families since they would be excused from huge tax burden and not

overreliance on government support programs to survive.

Raising minimum wage is said to be a way of reducing criminal activities in the country.

It was found that increasing the minimum wage to $12 would reduce crime rate by 3-5% (Wang

1401). It is because higher wages offer viable and sustainable employment to the population and

nobody would wish to involve themselves in critical activities. Many studies have shown that

increasing wages results in the reduction in property-related crimes (Wang 1401). Also, better

minimum wage allows people of lower income to have a better life despite having potential

threat to the free market. It means the minimum wage should be revised to enable people meet

their living standards.

On the other hand, the opponents of revising the minimum wage claim that there is no

evidence of linking between the minimum wage and reduction of crime rates. According to

Hirsch, crime rate increases by 1.9% among young people as the minimum wage increases (372).

Besides, the minimum wage increase would result in higher unemployment rate, which is likely
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to make some next generation not to afford education. For instance, John Raese was quoted

saying, “The minimum wage is something that F.D.R. put in place a long time ago during the

Great Depression. I don’t think it worked then. It didn’t solve any problems then and it hasn’t

solved any problems in 50 years” (Gregory and Zierahn 38). It implies that the minimum wage

has failed to offer a decent living and raising it still will not have an impact. A study was also

conducted by the American Journal of Economics and Sociology found out that in Maryland, an

increase of 25% of minimum wage was linked to an increase of 0.55% in the school dropout rate

for Hispanic students (Gregory and Zierahn 32). It implies at no point will the minimum wage

give people a live wage.

Increasing the minimum wage would make labour to be expensive for many industries.

For instance, as quoted by Marco Rubio, “If you raise the minimum wage, you’re going to make

people more expensive than a machine” (Carr 135). It implies many companies would resort to

machines rendering many people jobless. Also, the opponents of raising the minimum wage

argue it would not make the wage sufficient to individuals and their families, since high

minimum wage results in job losses, especially for low-skilled workers. Raising the minimum

wage would lead to higher prices of products and services lowering demand for market

development, leading to adverse long term effects for individuals and their families. Studies have

shown that increasing the minimum wage to $10.10 decreases the demand for workers, resulting

in laying off many people. Those still in employment would pay 15% more as taxes for every

additional wage (Carr 123). The decrease in demand results in devastating effects for unskilled

workers and their families due to reduced opportunities for employment and acquisition of

requisite skills. The rate of unskilled workers would increase since raising the minimum wage

lowers the continuation rate where people drop out at grades 9-12, especially for under 18
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(MaCurdy 527). The number of unskilled workers would increase with more job losses, leading

to indecent life.

The current minimum wage is not enough for people and trying to increase it would

increase the standards of living. According to Primer, raising the minimum wage to $22 per hour

increase consumer prices by 25% (47). It implies that minimum wage hike has little effect on

reducing unemployment rates. For instance, the restaurant industry is one of the sectors with the

highest number of employees earning minimum wage and increasing the minimum wage could

affect these workers. Increasing the minimum wage could result in higher prices for food and

other services, decreased working hours and also closures of some restaurants (Primer 48).

Workers will be laid off and the standards of living will go up beyond their reach.

In conclusion, the minimum wage debate is a complex issue and needs to be addressed

based on the increasing cost of living. The current federal minimum wage is at $7.25 while the

cost of living continues to go up making the minimum wage to be insufficient to afford a decent

living standards. However, there is an urge to consider adverse effects on businesses and the

overall economy. It is evident that there are clear arguments on both sides, meaning any policy

concerning the minimum wage should consider potential effects on employees, business

enterprises and the whole economy. Based on the arguments on the sufficiency of the minimum

wage, it is clear whether the minimum wage is raised or maintained it cannot be sufficient to

provide people with a decent living standards due to rising costs of living, increasing

unemployment, increasing tax burden, and inflation. As a result, people will have a living wage

that does not meet basic living expenses, aggravates economic inequality, as well as leaves no

choice but to demand for social security, underscoring the instant need for the reexamination of
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wage related policies for the sake of workers’ financial stability and dignity. It symbolizes that

the minimum wage is not sufficient and should be raised beyond the current rate of $7.25.

References

Adams, R. (2017). Standard of living as a right, not a privilege: Is it time to change the dialogue

from minimum wage to living wage? Business and society review, 122(4), 613-639.

Carr, S. C. (2023). Minimum Wage. In Wage and Well-being: Toward Sustainable

Livelihood (pp. 117-146). Cham: Springer International Publishing.

Congressional Budget Office (2014). The Effects of Minimum-Wage Increase on Employment

and Family Income. Cbo.gov

Crofton, S. O., Anderson, W. L., & Rawe, E. C. (2009). Do higher real minimum wages lead to

more high school dropouts? Evidence from Maryland across races, 1993–2004. American

Journal of Economics and Sociology, 68(2), 445-464.

Gregory, T., & Zierahn, U. (2020). When the minimum wage really bites hard: Impact on top

earners and skill supply. ZEW-Centre for European Economic Research Discussion

Paper, (20-042).

Hanke, S. H. (2014). Let the Data Speak: The Truth behind Minimum Wage Laws. Globe Asia,

April.
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Hirsch, D. (2018). The ‘living wage’ and low income: Can adequate pay contribute to adequate

family living standards? Critical Social Policy, 38(2), 367-386.

MaCurdy, T. (2015). How effective is the minimum wage at supporting the poor? Journal of

Political Economy, 123(2), 497-545.

McAtee, L. (2022). A Stepping-Stone? An Analysis of How the Minimum Wage Impacts the

Wage Growth of Individuals in Monopsonistic Industries.

Primer, A. (2014). Raising the Minimum Wage: The Effects on Employment, Businesses and

Consumers.

Wang, Z. (2022). Analyzing the Socio-Economic Impacts of the US Federal Minimum

Wage. Modern Economy, 13(10), 1397-1408.