Understand the information surrounding minimum wage

Understand the information surrounding minimum wage

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Whether at a fast-food restaurant, a supermarket or a retail store, many businesses start with minimum wage as their base salary option. But minimum wage has become increasingly political over the past few years, as some minimum wage workers have protested the amount they make and lawmakers have called for changes to the laws. Notably, the Obama administration has called for a raise in the national minimum wage. 

Any one restaurant or employer is subjected to a number of minimum wage laws. In the U.S. there's a federal minimum wage, which is currently $7.25 an hour. This covers the entire U.S. In some states, there are laws that establish a state minimum wage higher than the federal requirement, like Illinois, which pays workers at least $8.25 per hour. Within some states, cities can make their own minimum wage laws, such as San Francisco, which boasts the highest minimum wage in the U.S. at $10.74 and has put a referendum on this November's ballot to raise that amount to $15 by 2018. Often, when people discuss "raising the minimum wage" in a general sense, they're referring to the federal minimum wage, which the White House has called to be raised to $10.10. 

It's not just San Francisco that's going to be thinking about minimum wage come this November. Many people either directly or through who they elect will be making voting decisions based on their opinion on either raising or lowering the minimum wage. If you're directly affected by minimum wage, if your employees are or if you'd like to be a better informed voter, check out some of the information surrounding this important economic decision. 

Raising the minimum wage will reduce poverty in the US  
Economists disagree about how small raises to the minimum wage will affect the U.S. economy as a whole, but, as The Washington Post explained, they do agree that raising the federal minimum wage will lower poverty rates across the U.S. 

"Using this as an estimate, raising the minimum wage to $10.10 an hour, as many Democrats are proposing in 2014, would reduce the number of people living in poverty by 4.6 million," Washington Post columnist Mike Konczal wrote. "It would also boost the incomes of those at the 10th percentile by $1,700. That's a significant increase in the quality of life for our worst off that doesn't require the government to tax and spend a single additional dollar."

Economists, like politicians, often have trouble finding a middle ground when analyzing data, but they agree that raising the minimum wage can reduce the number of people living below the poverty line based on projected data. 

Many people make minimum wage 
Another disagreement that often plays into politics is who actually makes minimum wage. Some suggest that it's mostly teenagers, while others suggest it's heads of household supporting a family. The Atlantic magazine looked at this question and found that the answer is somewhere in between. About one-third of those who make minimum wage are teenagers, and many of them are enrolled in school as well. But there are plenty of others who work minimum-wage jobs at a later age either for long terms or short amounts of time. 

Both sides of the political spectrum use information that supports their viewpoint, but the fact is that people from a variety of backgrounds of all different ages and needs work careers that pay minimum wage. 

Understand what the proposals are 
There are no serious calls to lower the minimum wage. People are discussing raising the federal, state or city minimum wage, or leaving it where it currently is. Likely the most important, potentially far-reaching and impactful call for a minimum wage hike came from President Barack Obama in his 2014 State of the Union address. Since then it's been supported by some politicians and denounced by others.

No congressional action has been taken in favor of raising the minimum wage, although President Obama did sign an executive order to raise the minimum wage of individuals working on federal contracts.  

Opponents of raising the minimum wage are typically opposed to the legislation because they believe that it will reduce the number of total jobs. Many employers that have to pay workers more per hour will be unable to afford as many workers, and some places may instead spend money on technology for certain unskilled tasks, such as selfcheckouts. Others oppose government that interferes with the economics of employment by creating a price floor. 

Some people in favor of wage hikes disagree and think that the raise will stimulate the economy by giving those wage earners more income to spend. Others are less concerned with economic health and more focused on quality of life and well-being for minimum wage earners. 

Minimum wage has become a major issue throughout the U.S. recently. Thirty-four states are considering minimum wage increases in 2014, according to the National Conference of State Legislatures. Regardless of your opinion on the issue, as minimum wage grows in importance leading up to the November elections, it's crucial that you're well-informed so that you make decisions that count. 

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