What the other side might say...

 

Some might say that increasing the minimum wage might hurt the middle class, however that is not necessarily the case. Research indicates that increasing the minimum wage reduces the income inequality between the middle class and lower income families. It also shows that increasing the minimum wage does not have an impact on the middle class families at all. Increasing the minimum wage actually benefits the middle class.

   According to Oren M. Levin-Waldman, the author of How Raising the Minimum Wage Would Boost the Middle Class,  "Higher pay at the bottom of the scale ripples upward, improving purchasing power for everybody" (Waldman). This means that if wages are increased the lower income workers will improve the purchasing power for middle class workers as well.  Also the reason that income inequality has been increasing lately and the middle class has been shrinking is because of wages that remain stagnant. According to Waldman," increasing the minimum wage would go far toward reversing that trend (Waldman).  This means that increasing the minimum wage decreases income inequality and if the minimum wage is not increased the gap between the lower and middle class increases. The other side might also say that increasing the minimum wage will result in job losses for newly hired and unskilled workers. However, this is not accurate because minimum wage increases have little to no negative effect on employment because there have been studies done by more than 600 economists, including seven Nobel prize winners that show that the employment levels stay the same regardless of whether the minimum wage is increased or not. There has also been some academic research that shows that higher wages sharply reduce employee turnover which can reduce employment and training costs.

  The opposing side of this argument might also say that that increasing the minimum wage will cause people to lose their jobs. This is also not correct because research has been conducted by economists that suggests that a minimum wage increase could have a small stimulative effect on the economy. The reason for this is that as low- wage workers spend their additional earnings, they raise demand and job growth, and provide help in developing more jobs. Another argument that a person who is against raising the minimum wage might say is that increasing the minimum wage is bad for the economy. This opposing argument is also not correct because since 1938, the federal minimum wage has been increased 22 times and for more than 75 years the real GDP per capita has steadily increased, even when the minimum wage had been raised. These facts indicate that the increasing the minimum wage does not necessarily hurt the economy. This is the reason why the minimum should be increased to $15 per hour by 2019.

Works Cited:

Levin-Waldman, Oren M. How Raising the Minimum Wage Would Boost the Middle Class13 Feb. 2014, www.governing.com/gov-institute/voices/col-raising-minimum-wage-boost-middle-class.html. Accessed 9 Nov. 2016

Minimum Wage Mythbusters , United Sates Department Of Labor, https://www.dol.gov/featured/minimum-wage/mythbuster. Accessed 10 Nov. 2016. 

Increasing the minimum wage increases worker productivity

  The minimum wage should be increased to $15 per hour by 2019 because doing so will increase worker productivity. Some recent studies have shown that higher minimum wages can contribute to higher worker productivity.Some studies have shown that raising the minimum wage allows workers to become more motivated. George Ajerlof, an economist came to the conclusion that employees show signs of higher effort levels in response to higher wages. This phenomenon is known as the efficiency wage theory.  According to economists Ronald G. Ehrenberg and Robert S. Smith, "higher pay can also elicit greater commitment and productivity from existing employees"( Ehrenberg and Smith). The efficiency wage theory also explains that higher pay increases the employees motivation towards the work that they are doing and when this happens the employees will work more efficiently and effectively. This will help worker productivity.

The effect of minimum wages as opposed to higher wages in individual firms on workers’ motivation has also been found to be positive. After conducting a standard natural experiment economist, Georgiadis found that the United Kingdom’s national minimum wage has operated as a kind of “efficiency wage' in the residential care homes sector because it increases motivation and leads to a reduction in the level of worker supervision required.  Further evidence from experiments conducted in the U.S. by  economists Mark F. Owens and John H. Kagel, also point to a positive relationship between minimum wages and workers' effort, which leads to the conclusion that " if well designed minimum wages can generate improved outcomes where employees have higher wages and employers have the same, or slightly higher, average labor cost" ( Owen and Kagel). Three economists Arindrajit Dube, T. William Lester, and Michael Reich found  that in a 10% increase in the minimum wage results in a reduction of 2.1% in turnover for restaurant workers and a 2.0% reduction in turnover for teenager ( Dube,Lester, Reich).  This shows  that increasing the minimum wage can be beneficial for people who also get tips,  such as people who work in restaurants. This is the reason that increasing the minimum wage will increase worker productivity.

Works Cited:

Dube, A.; Lester, T., W.; Reich, M.; 2012. Minimum Wage Shocks, Employment Flows and Labour Market Frictions, IRLE Working Paper No. 122-12

Ehrenberg R. G. and R. S. Smith, 2009. Modern Labor Economics: Theory and Public Policy, 10th Edition,Pearson

Owens and Kagel (2010), “Minimum wage restrictions and employee effort in incomplete labor markets: An experimental investigation”,Journal of Economic Behavior & Organization, 73, p.317-326

Increasing the Minimum Wage Will Reduce Crime

The minimum wage should be increased to $15 per hour by 2019 because this will decrease the crime rate. According to the author of the article,

White House Argues Raising the Minimum Wage Will End Crime Faster Than Mass Incarceration, increasing the minimum wage is better than incarcerating individuals. The following chart below shows that increasing spending on incarceration by $10 billion leads to 1% to 4% reduction in the crime rate whereas, if the minimum wage is raised to at least $12 in 2020 then there will be a 3% to 5% reduction in the overall crime rate. The chart also shows that when the minimum wage is increased then the net societal benefit is $8 billion to $17 billion.  In comparison increasing spending on incarceration only leads to a $1 billion dollar benefit from the reduced crime.

In addition according to Juleyka Lantigua-Williams, the author of

Raise the Minimum Wage, Reduce Crime?,“Higher wages for low-skilled workers reduce both property and violent crime, as well as crime among adolescents" (Williams 1). The reason that the author gives for this is that  increasing the minimum wage provides an incentive for adolescents to work and that allows for less crime rates because adolescents are less likely to commit crime if they have a good paying job. Also Williams states that “the impact of wages on crime is substantial , a 10 percent increase in wages for non-college educated men results in approximately a 10 to 20 percent reduction in crime rate" ( Williams 2). This statistic shows that increasing the minimum wage decreases the crime rate. Another statistic that further supports this claim is that, NBER Faculty Research Fellow Jeffrey Grogger estimates that "a ten percent increase in wages would reduce youth participation in crime by roughly 6 to 9 percent" (Grogger). This indicates that increasing the minimum wage will help reduce the crime rate in the younger population. He also comes to the conclusion that when there is 20 percent drop in wages that  will lead to a 12 to 18 percent increase in youth crime. In addition Jeffrey Grogger states that younger men are effected a lot by price incentives which means according to Grogger, "the more money they can make through legitimate means, the less likely they are to commit crimes" (Grogger 4). This is why the minimum wage should be increased to $15 by 2019.

Works Cited:
Aleem, Zeeshan. White House Argues Raising the Minimum Wage Will End Crime Faster Than Mass Incarceration27 Apr. 2016. Accessed 2 Nov. 2016.

Grogger, Jeffrey. Higher Youth Wages Mean Lower Crime Rates www.nber.org/digest/nov97/w5983.html. Accessed 2 Nov. 2016.

Wiliams, Juleyka L. Raise the Minimum Wage, Reduce Crime?6 May 2016, www.citylab.com/crime/2016/05/raise-the-minimum-wage-reduce-crime/481014/.
 Accessed 2 Nov. 2016.