Fight For 15:
The Fight for 15 has become the largest protest by low-wage workers in US history. With millions of workers striking and protesting across the North America in support of the cause. The campaign has even sparked similar initiatives in other countries. Workers across the globe are also demanding to be paid more for their work.
Workers are seeking various job improvements, including higher wages, benefits and unionization. But the question is, will low-wage workers end up the biggest losers when all is said and done?
There are so many sides to this issue, that establishing a position is difficult. Every working person deserves to be able to afford their necessities, have the opportunity for education, training and healthcare. But, how will we get here and who will have to pay for it? How will the middle class be affected when their wages stay the same but inflation strikes due to the minimum wage increase?
Will increasing the federal minimum cause more problems than it resolves? Would it result in higher income security for the few, and lower job security for the many?
The proposed $15 per hour is quite a significant boost from the current federal minimum of $7.25 per hour. This is causing many to claim that such a jump will cause nothing but problems for the people fighting for the pay increase. Further claims are that such a dramatic increase would cripple the prospects of some of the most economically vulnerable.
Ain’t No Jobs:
Are companies going to move toward technological proliferation in order to offset the costs associated with a wage increase?
This is very possible.
Competition for labour is already high in America with the number of “unemployed persons” sitting at approximately 7.9 million, those who work “part-time for economic reasons” rose to 6.0 million, and the “labour force participation rate” decreased to 62.8%.
Let’s face it, the labour market has changed, and it doesn’t appear likely that this is going to slow down.
Most working Americans seek to become self-sufficient, independent and financially autonomous. However, with the low-pay made from working a minimum wage job, many are left unable to provide for their basic needs such as adequate food, shelter, and medical care.
This puts a strain on the economy. As a result the responsibility for these expenses often falls onto the taxpayers in the form of government assistance programs.
People Can’t Live:
It seems as though raising the minimum wage is a double edged sword. Many people in America are raising families off of minimum wage causing them to work intense hours at 2 or 3 different jobs. This is creating a large income gap between the rich and the poor and contributing to the decline of the middle class.
The libertarian argument here often revolves around people maintaining that minimum wage jobs are not intended for people to be raising families off, and so, parents should develop their personal skills and find employment elsewhere.
But, from the utilitarian perspective how does one develop their human capital by way of education and training, when it is so expensive to do so?
How can social mobility be achieved when you barely have enough money to cover your necessities?
Everyone has to start somewhere, and maybe how little many services jobs pay, can in part explain why so many Americans find themselves essentially stuck in a stagnant position with no chance of moving up.
One Size Never Fits All:
It’s largely a myth that anything can be one size fits all. Everything has variations. Simply paying people more for doing the same job is not going to change the entire face of the American working class over night.
Applying a one size fits all solution to the problem of low wage earners in America, logically, is unlikely to result as intended.
From this perspective, the minimum wage should be relative. Relative to variables such as the cost of living in different parts of the country, inflation, and buying power. This would ensure that all full-time workers have enough to make ends meet, while also minimizing budgetary strain on small businesses.
Spend It If You Got It:
Raising wages would raise people’s disposable income. Raising people’s purchasing power brings growth to the economy, as the more money people have, the more money people spend.
This is fact.
Additionally, many argue that when disposable income is increased, the bottom line of businesses are boosted across the country.
Spending is stimulated when economic security is increased.
Loans and credit are easier to obtain when the economy is doing well as a result of lower interest rates. People are also more inclined to save and invest when the economy is flourishing, which is good for everyone!
Businesses, like it or not, are all about their bottom line.
When that bottom line is threatened, it creates a need for a re-evaluation of the business model, which usually results in cost-cutting. Methods of cost cutting more often than not, begin with a business identifying ways to reduce expenditure.
From a business perspective, there are few better ways to reduce expenditure than by firing or reducing the hours of employees, or by moving business elsewhere all together.
So although wages may increase for some employees, other employees may see their hours decreased, or find themselves out of work entirely.
We witnessed the manufacturing industry drastically change as workers began to demand more. This came in the form of automation, or simply moving operations overseas where wages are cheaper and labour laws are less stringent.
In response to the call for a wage increase, fast food chains such as McDonald’s and Wendy’s are introducing automation technology in the form of self-ordering kiosks where customers can order their food on their own.
This introduction has left many wondering how far this will go. Demanding a high wage for low-skill work, could actually end up costing jobs as enterprises seek to avoid the wage increases by implementing other options.
Weigh the Options:
Many maintain that increasing the minimum wage is not the right way to help low-income earners, and that there are other viable options that should be considered to address the problems facing those who earn the minimum wage. Help people, help themselves.
Investing in education and training programs would serve as a far better way to get people earning more money. More knowledgeable people, with a developed skill set will be able to move upward in the workforce, ultimately leaving the minimum wage jobs for who they are intended for, teenagers and retirees who are bored of being at home.
An evaluation of the inflationary monetary system which causes the continual increase in costs of things people need to live, should be implemented. Low incomes are a symptom of fiat money, wherein the value of money is derived from a relationship between supply and demand.
Fiat money has become a storage medium for purchasing power and holds no intrinsic value, it cannot be converted into silver or gold and is in reality worth less than the paper it is printed on. It creates inflation and hyperinflation.
Rather than raising the wage, could a solution be found in stopping central banks from the endless money printing which enables the governments to do it’s unlimited spending?
No matter how you look at it, there is a host of problems here that need to be addressed. Everyone deserves to have their basic needs met. If this is not happening, then solutions must be found.
Whether or not raising the minimum wage is the best way to achieve a solution is uncertain.
But, as the protests continue and the wages grow, we will soon find out.