The Minimum Wage Debate

The minimum wage debate

Hey you do you think the minimum wage amount should be raised? If yes is your answer or no is your answer, let’s have the minimum wage debate today. The current minimum wage in my state is 8.25 cents an hour, or 330 dollars per week, or 1320 per month. This is the amount prior to taking out federal and state taxes. I don’t know about you but 330 dollars a week doesn’t go far to support anyone in 2015.

From my research the average rent in my area for a 1 bedroom apartment is 850 – 1200 dollars per month. Now can someone making 1320 per month successfully pay for shelter, including food, utilities, and transportation costs? Unfortunately it is impossible for many people who oppose raising the minimum wage to do a simple budget. Thanks to a coworker I got a flyer from the national low income housing coalition, and it states a housing wage should be 25.17 per hour as the minimum in order to afford a two bedroom fair market rent in NJ. I can add and subtract with ease, and if you take 25.17 -8.25 = 16.92. That is how much we are off per hour for someone making minimum wage to afford a two bedroom rent.

Granted you could argue that the people making minimum wage should learn better skills to get out of the poor trap. I agree with that statement, but is it still right to keep the minimum wage so low at 7.25 dollars an hour on a federal level? In a country where costs are going up every year for basic living necessities, shouldn’t the hourly wage rise in step with the expenses? If rent goes up by $75 dollars every year, and the hourly wage stays the same for 4 years, how is a person able to make ends meet or save for the future?

Now another argument the people who oppose raising the minimum wage say, the people earning $7.25 an hour still live at home with their parents. Well if that’s the case you’re making, do you expect those kids to live with their parents forever? If not then why not begin to raise the minimum wage for anyone over 21 years of age, and or has their own dwelling. If its a teenager fine leave it at a lower level. Things can be tailored to fit different scenarios.

Do you know research shows that minimum wage retail associates spend a big portion of their pay in the jobs they work for? Now if business owners had common sense, the more you pay them for working there, the more they will most likely spend to buy goods. It’s a win- win for both sides of the fence. If they don’t end up spending it in the establishment they work for, then they will spend it someplace else locally. Thus helping to improve the economy in a big way.

Another section of the low income flyer lists the hours needed to work at minimum wage in order to be able to afford housing without going over 30% in housing costs. I would have you know that in 0 states can someone afford a 1 bedroom making minimum wage without going over 30% of income for housing. The worst state is Hawaii at 125 hours worked @ minimum wage in order to pay for rent.

Hours Needed to Work @Minimum Wage to be able to Afford 1 Bedroom Apartment:

Hawaii – 125

Maryland – 101

DC – 100

NJ – 100

NY – 98

I hope you can see that its impossible to afford rent while working on minimum wages, unless the person cuts other basic necessities. I found a link to an article where over 600 economists signed a letter of petition for legislation change in order to raise the minimum wage.

Why is it that the politicians who rely on the economists for research and information, will not listen to them on this matter? In my opinion the economist know best how financial issues will either hinder or improve the economy. Why would all of these economist’s agree on raising it? Well the answer is simple because it will only help the U.S. as a whole.

I believe people will find hope as states and cities slowly realize the need to begin increasing the minimum wage as soon as feasible. The proof is right here in this post, where Los Angeles is the first major city to begin raising the minimum wage to $15 dollars per hour by 2020. 

What is your take on the minimum wage debate?

Rich Uncle EL 

 

Pic provided by The Daily Iowan


Comments

The Minimum Wage Debate6 Comments

  1. NYS minimum wage is currently $8.75 going to $9 by the end of year. I always consider this a wage for P/T young workers, but with the recent debate seen a number of people try to live off of it as their F/T salary. I agree it's near impossible to do. I recently visited my local department of labor and there are a number of free services available, including training and certificate programs. I don't think just raising the minimum wages fixes this issues, we need to fix some of the attitude workers have towards work too.

    • Yes I couldn’t agree more with workers getting new skills and changing attitudes. It’s up to the hiring managers to give hard working people with good attitudes, the higher wages, and weed out the others who have unfavorable attitudes. Thanks for stopping by Brian.

      • Raising wages will cause many people who are low skilled to become unemployable. We are going to see more technology do the jobs that were done by people. Ultimately, if people want to make better wages they are going to have to get an education, be it a trade or a degree, that will allow them to get a better paying job.

        • I will respect you’re opinion, but I disagree. Low skilled people need a fair wage to help them succeed financially. When people advance in life they grow and become better citizens, avoiding government assistance and crimes. Technology will replace people no matter the wage, look at how machines replaced many jobs decades ago when minimum wage was higher relative to expenses.

  2. I believe that it's minimum wage for a reason. You're not supposed to stay there. It's a starting point. I'm all for people getting more money but if the job isn't going to give it to them, they have to find another way to get it. I think a lot of people fail to realize what they can do if they put their minds to it.
    My recent post June 2015 Debt Update

    • Good way of analyzing the issue, i prefer to hear all sides of the debate. I agree people should move on and find something better, but as one of the richest countries in the world, we are income stagnant and its not good for the society in general. The economy cannot be only 1 sided with increased expenses and stagnant wages.

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