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Thousands came together last week in a nationwide strike for a $15 minimum wage, highlighting how livable wages have become a significant issue in this election cycle. Although the proposal has faced significant backlash, many of the arguments against it are grounded in myth.
Opponents of a $15 minimum wage argue the consequence of enacting such policy would result in employers hiring fewer workers or reducing the number of hours employees work. However, nonpartisan research institution Center on Budget and Policy Priorities looks at the issue beyond simple supply and demand and uses mostly empirical precedent for their research.
The institution argues raising the minimum wage would increase business efficiency by increasing employees’ perceived value of work and increasing employers’ performance standards. This combination would then yield lower job turnover and reduce employers’ hiring costs, leading to employment gains. Further research also shows that with at least a moderate increase, the minimum wage has had little effect on the amount employed. And although a $15 wage isn’t necessarily moderate wage increase, that doesn’t mean that the government shouldn’t find a way to gradually reach that point.
What a livable wage will do is increase the purchasing power of individuals and allow people to overall buy more, leading to further economic growth. However, opponents of the minimum wage increase would argue that when increasing the minimum wage, this growth would negatively affect low income workers because it would increase the prices of goods and services. But according the Economic Policy Institute, a minimum wage increase will protect people from prices that will increase regardless.
Even beyond economic issues, we have to look at the amount of people without a livable minimum wage. A person working full-time with two kids needs about $30,000 to be able to live and stay out of poverty. That’s a $15 minimum wage over a 40-hour work week, which would raise four million people out of poverty. Morally speaking, if it can increase the quality of that many lives, the $15 minimum wage is an absolute necessity.
It’s easy to say that we can leave this issue up to the states, especially when a $15 minimum wage wouldn’t be necessary in some areas than others. But if the country wants to see substantive change in its domestic fiscal policy, without the harms usually projected by wage increase opponents, it would gradually increase the minimum wage to a livable wage like $15. Otherwise we’ll be leaving four million people in a third-world America.
Choudhury is an economics freshman from Richardson. He is a senior columnist. Follow him on Twitter @MubarratC.