For this discussion I will focus on why employee pay is low. Many
people that fall under the essential worker category are underpaid
and overworked. Gabriel Zucman an economist at the University of
California Berkeley talked about how wage practices are arbitrary
and that social, political, and economic practices are manipulated to
the advantage of the few instead of the many (Ingraham, 2020).
Low paying jobs cause a domino effect of negative outcomes for
employees and employers. Employees that are earning an unlivable
wage are often not able to support their households without
overworking themselves. This leave little time for them to further
their educations or take certification courses in order for them to
advance in the job market. If a job is not working out employees will
not hesitate to quit, because they know that they will be able to find
a similar paying job. This effects companies because their turnover
rate stays at a consent high, which increases their cost due to paying
for recruiting and onboarding expenses frequently.
The first thing that comes to mind when talking about raising the
minimum wage is that the standard of living will increase for millions
of people. These individuals will also have more disposable income
that they could pump back into our economy which would benefit
many companies.
A 2019 Congressional Budget Office (CBO) report projected a
significant improvement in the standard of living for at least 17
million people, assuming a minimum hourly wage of $15 by 2025,
including an estimated 1.3 million people being elevated above the
poverty line (Maverick,2021).
The risks of raising the minimum wage are inflation and higher
operating costs. Considering that CEO’s and many other high-level
company officials have increased their earnings since the minimum
wage was increased I believe that their are ways to counter the
effects of inflation that do not suggest leaving the working class to
live on a poverty wage.
References:
Ingraham, C. (2020, April 6). Analysis | why many 'essential' workers get
paid so little, according to experts. The Washington Post. Retrieved
January 14, 2022,
from https://www.washingtonpost.com/business/2020/04/06/why-
do-so-many-essential-workers-get-paid-so-little-heres-what-
economists-have-say/
Maverick, J. B. (2021, May 19). What are the pros and cons of raising
the minimum wage? Investopedia. Retrieved January 14, 2022,
from https://www.investopedia.com/articles/markets-economy/090
516/what-are-pros-and-cons-raising-minimum-wage.asp
