Would increasing the minimum wage help or hurt the working poor in United States?

History
The minimum wage of the federal act has always been used in alleviating the condition of the poor. It was in the year 1938 that the federal minimum wage was first used into action which was a part of the Fair Labor Standards Act and the minimum hourly rate of a labor was set to 25 cents per hour; however, this law did not include everybody who was coming under the poverty line. In the year 1983 to 1989 the minimum wage was revised and set to $3.35 and within a decade it was revised to at least four times and in the year 1997, it was raised to $5.15 per hour. At the present time, the minimum wage of a labor has been set to almost $7.25 per hour. This clearly states that if we calculate the minimum wage of a labor for the entire year, it comes to around $15,800. As the poverty threshold is $18,500, so a family, who has at least 3 members which may include one or two children, falls under the poverty line. There are many people who say that as the United States is a wealthy nation, a worker who works for full time should be able to support his family. If we consider the income inequality among people in the United States, this seems to be relevant.

Prevalence and Seriousness of the issue

One of the biggest concerns of the public health community is poverty. At the present time, the number of people who come under the poverty line has increased. It is noticed that earlier in 1990s, the poverty of the country declined, but considering the figures from the United States' Census Bureau (USCB), it was reported that there has been a significant rise in the poverty rate, which was 11.3% in the year 2000 but got increased to 12.7% in 2004. It was noticed that it were the children who suffered the most as their poverty rate were more. The proportion of children who were living in poverty saw a rise of 13.4%, that is, it rose from a rate of 15.7%, which was 11.1 million, in the year 2000 to 17.8%, which is 13.0 million, in the year 2004.

Impact of this issue on families

The impact of poverty on families is considered very serious. Children growing in the poverty suffer the most. They go through a lot of health problems; as a result, they rarely go to the school. Even infants are born underweight. It was also noticed that due to the recession in the country, many suffered job loss, due to which there were family fights and abuses. People, who went through the tough time of financial hardship, faced many problems including threats, insults and even corporal punishment.

The people who come under the poverty line are mainly homeless. This creates lot of risks for them especially, if there is a child in the family. There are people who are under the poverty line but still have a home, so there condition is still considered better than the one who do not have a house, as they are at more risk. Families, who are homeless, go through more stress along with problem in working, going to school, etc. They even have a lot of family issues.

Pro and Con Side

Role of Key Players who are in support

The government of United States plays a key role in removing poverty. There are several federal programs and projects that are provided by the government to help the public in education, health and even safety. This assistance is provided through federal agencies. They supply the resources to the poor people. In order to help the poor financially, the US government also provides 'grants'; however, for this, the person has to first apply. These 'grants' are of different types to award people with different needs.

Even Social workers throughout the country try to do everything possible to remove the poverty from the country.  In everyday life social workers come across many poor people, they help them to understand the situation that they are in and to change themselves along with their environment to come out of this issue. Along with that it is also required that each community work towards developing themselves which will automatically upgrade the standard of living of all the people in the community. The social workers even work with individual families where there main focus is on enhancing resources along with providing opportunities where they understand their personal capacities.

To overcome poverty, there are many organizations who work towards removing it. They are among the key players who work towards it. The organizations create new job vacancies and employ people which help them financially. Along with that they also run several programs where they make the people aware of their efforts and try to change their view towards their current situation. This helps them to know their potential and work on them accordingly to enhance their situation.

Key Players who are in opposition

Even though, the increase in the minimum wage of the workers is helping the low-income household to improve their living, still there are some people or organizations who are against this hike. There are some economists who oppose a higher minimum wage. While arguing they say that if the minimum wage of the workers is increased, there will be a decrease in the number of jobs available in the country. For example, a study done by the CBO states that if the minimum wage of the workers are raised to $ 10.10, the total employment in the country will see a decrease of 500,000. If there are less entry-level jobs, then less inexperienced workers will be appointed for a job which requires more skills as well as experience.

There are also certain business groups who stand against this law and oppose them. According to them, the increase in the minimum wage will see a significant decrease in the availability of jobs and it might come to a saturation point. This will again lead to less employment in the country and hence those who are skilled will not get a job according to their ability. Along with that there are also some businesses that are paying less to their employees, so increasing their wages would mean that they will have less profit. So, there are people who are also not supporting this raise on moral grounds.

Strengths and weaknesses of the key players' position

The government and the social workers who are supporting the hike in the minimum wage of the workers are also supporting the fact that the raise in the income will improve the individual's life and they will be able to educate themselves and their children. Many social workers have actually been to the places of the poor people and have felt the bad situation that they are going through. So, since they are supporting this law, they will have more support from the other community people. According to them, everybody should have a good standard of living and they believe in equality. They tend to get more support than those who stand against this law.

On the other hand, people who are standing against this hike would get less support from people. Although according to them, with the increase in the minimum wage there will be less employment, but the employment opportunities can be made available by more vacancies and by establishing more companies. So, there stand against this hike is to some extent, not logical.

Is their argument convincing?

The arguments given by the key players who do not support this hike, is not considered convincing. As per them, with the increase in the wage, the nation will see a significant loss in the number of employment. However, depending upon this it is not considered to let the poor live in the way they are living. On moral grounds, one should think of helping these people rather than allowing their situation to worsen.

According to a study, it was found that only 19 percent of the people who will benefit from the raise in the minimum wage are actually considered poor. So, this means that 81 percent of them would not be affected by the higher wage. Hence, if these 19 percent people start getting higher wage, after a certain period of time, there will be no people in the community who will come under this percentage and there will be about 900,000 people who will come out of the poverty line. Thus, the country will be 100% free from poor people. In this situation, it can be said that the country does not have any poor people.

Conclusion

In reference to the minimum wage, there are different laws that have been enforced.

• In United States, nine localities have enacted currently on the minimum wage law: Albuquerque, NM; Bernalillo County, NM; Montgomery County, MD; Prince George's County, MD; San Francisco, CA; San Jose, CA; Santa Fe, NM; Santa Fe County, NM; and Washington DC. Out of all these localities Richmond, CA has already voted in order to increase the minimum wage to $ 12.30 per hour by the year 2017.
• Currently, the mandatory minimum wage ranges from $8.50 per hour in Bernalillo County to $10.74 per hour in San Francisco.
• On an average, the minimum wage laws that currently exist have made it mandatory for the wages to increase by 41.4 percent. Most of them are required to get this increase in multiple steps; however, for some it is to be made effective immediately. There are several localities who have already implemented this law in several steps. The average increase in the minimum wage per step across all the localities is 16.7 percent.
• All the laws that are enforced in the nine localities are similar and cover the majority of the work which a worker performs while staying within their counties. The coverage of nonprofits was delayed by San Francisco and also it got delayed for small businesses (which were less than 10 employees) for one year. On the other hand, Santa Fe first removed the small businesses; however, later it amended its law and started covering all the businesses.
• Out of the nine laws, two of them (San Francisco and San Jose) have the same law as the state's for treating the workers who get tips and the workers who don't, hence a uniformity in wage is maintained between both the groups. The other seven laws follow the law of their state which says to maintain a lower minimum wage for the workers who are tipped (even after an increase in the base income of the tipped workers). Similar provisions are made by several of the other laws in context to the commissioned workers.
• After the enforcement of these laws, it has been seen that it has benefitted many to some extent. There are also many families whose minimum wage was much less than anyone could think of, so for them, these laws have proved to be a blessing. Although few find that there is a small increase in the prices when they go to any restaurant, but in other businesses there is no such increase in the price. So, overall the minimum wage laws have helped people.
• In future, if the minimum wage of the workers is not changed then the society as well as the country will face lot of problems. As the poor will not get a chance to improve their financial condition, they will keep becoming poorer and the rich will become richer. So, 20 years down the line the country will see a huge demarcation between the rich and the poor. It will have a big impact on the country's financial situation. However, with the enforcement of the minimum wage laws, the poor people get a chance to improve their present condition. They can even start utilizing their skills when their financial condition improves. So, in this case, after 20 years, it might happen that there will not be any section in the community which will be called poor. They will at least have a house to stay and will be able to educate themselves.
• In order to improve the condition of the poor and increase their minimum wages, there should be more laws that should be made in order to help the low wage workers. Along with that there should be different programs established which specifically targets the people who have low income. These programs might include welfare programs related to stamps and other welfare programs along with the credit of the income tax.