Many economists and business executives who point out that labor is a major cost of doing business argue that businesses will be forced to cut jobs to maintain profitability.
Many economists and business executives who point out that labor is a major cost of doing business argue that businesses will be forced to cut jobs to maintain profitability.Tags: Writing An Essay In Third PersonTrinity College Thesis BindingTitle Company Business PlanStyle Business Report WritingExample Introduction To A Research PaperEssay My Best Friend Class 6thConnelly Foundation Scholarship EssayGood Topics For Persuasive Essays
The job losses could occur as a result of higher wages placing a greater strain on companies, which could lead to cutting jobs, reducing employee hours, and other methods to save the company money.
The CBO reported that this number is not a definite, and that 500,000 may be an overestimate or could be a low ball and job losses could get as high as 1 million.
These are major benefits, especially when we consider the economy that is still struggling to recover. While raising the minimum wage has some upside, there are also potential downfalls.
The main potential negative impact of raising the minimum wage is the loss of close to 500,000 jobs, which comes out to around 0.3% decrease in employment.
Naturally, the more money workers earn through wages, the more they have to spend as consumers.
Thus, those higher wages will be passed on through greater levels of spending power.The numbers could be substantially higher if companies made a major move toward outsourcing more jobs to less expensive labor markets outside the country.One potential negative impact that is less readily apparent is the possibility that a higher minimum wage would result in increased labor market competition for minimum wage jobs.Among the disadvantages of increasing the minimum wage is the probable consequence of businesses increasing prices, thus fueling inflation.Opponents of an increase argue that raising the minimum wage would likely result in wages and salaries increasing across the board, thereby substantially increasing operating expenses for companies that would then increase the prices of products and services to cover their increased labor costs.An intangible benefit that could translate into tangible benefits for both companies and employees is improved employee morale resulting from higher wages.Business owners frequently note the challenge of providing sufficient encouragement to spur workers to put maximum effort into their job duties, and that this is particularly problematic with low-wage workers who feel that their efforts aren't even managing to keep them out of poverty.By increasing the minimum wage by almost three dollars more an hour, these workers would better be able to support themselves and their families.A second benefit, to raising the minimum wage, is not only will it raise many low wage workers out of poverty, but will help the overall economy.A boost to economic growth is another potential advantage of increasing the minimum wage, as consumer spending typically increases with increases in wages.A higher minimum wage would put more discretionary dollars in the pockets of millions of workers, money that would then flow to retailers and other businesses.