Minimum wage is a hot topic of discussion in many countries around the world, including the United States. Minimum wage increases are necessary for low-wage workers to maintain a living income. Changes to the economy’s structure will benefit everyone and improve the nation’s economy. Changes in the administration of the government could be helpful to improve the economy. This will help to reduce the amount of government aid, improve the health and likelihood of people, as well as decrease employee turn-over. Currently, the federal wage minimum of $7.25 puts an adult with a family of two thousands dollars below the federal threshold for poverty. (Scott. 2019) We are in favor of a minimum wage to ensure that our families can be provided for. Living wage is the income amount that provides a decent standard. The wage should cover living costs in any place. The living wage should be adjusted for inflation. A living wage ensures that full-time workers can live above the federal level of poverty. Living wage and national minimum wage are often confused. Congress in the United States originally set the minimum wages with the goal of providing a reasonable living wage. (Amadeo – 2020) Minimum wage and living wages are two different things.
After a decade in which the federal government has not increased the minimum wage, this is the longest period ever in American history. There are now no areas in America where an employee making the minimum wage can buy basic necessities. Raise the Wage Act will help lift workers and their families who are struggling out of the poverty. Edlabor.com, 2019. This means that the worker living below the poverty line is dependent on the help of local governments to pay for basic living necessities. They may be small, but these items are crucial to a person’s everyday expenses. Working a minimum wage job while raising a child is not easy. All of these services are provided by the state governments. Most SNAP participants are employed in sales, administrative support, or service occupations, such as home health aides and cooks. Since 2009, the Fair Labor standards Act has set the Federal Minimum Wage at $7.25. Act requires that any employee who works more than the 40-hour limit in a workweek receives 1.5 times their standard wage as overtime. This is not an enormous amount but it is what most companies must pay to their employees. Federal minimum wages can also differ from state-to-state because they are different. States can pass laws governing minimum wages. State minimum wage laws may be lower, equal or higher than federal minimums, or they can not exist at all. The federal wage applies if the state’s minimum wage is less than the federal minimum or the minimum wage in the state is not set at all. Debt.org (2013) states that wages in some sectors are so low, even full-time workers must depend heavily on government aid to survive. This suggests that low pay by many employers–facilitated by weakened or inadequate labor standards, such as a low minimum wage and outdated overtime regulations–is placing unwarranted demands on public resources. (Cooper, 2016)
Some employers pay living wages even though they are not required to. Some workers feel that $14.50 per hour isn’t enough, especially as D.C. becomes more expensive. Ann-Simmons (2019) Starting July 1, 2019, all District of Columbia workers will receive a minimum wage of $14.00 an hour, regardless of their employer size. In accordance with the new law minimum wages will be gradually increased to $15.00 each hour on 1 July 2020. On July 1, 2019 base minimum wages will be raised from $3.89 each hour to 4.45. The employer will be responsible for any difference between the minimum wage and the employee’s hourly tips. (DOES.Gov 2019) Most minimum-wage workers work in the food service industry. Many people make money by collecting tips or gratuities from consumers. Some companies charge employees a tax on tips, as they are included in their base salary. Employees who receive tips will see their minimum wage increase by $5.00 in 2020. This increase will be based on the Consumer Price Index. (DOES.gov, 2019)
Companies that only pay minimum wage have a higher turnover rate than companies that pay more per hour. Gusto’s data shows that, according to tens thousands of small-business employers across the U.S. whose employees earn $7.25/hour as the federal minimum, 70% of them will leave within one year. That is twice the typical turnover rate of 32.5%. The Raise the Wage Act was recently passed by the U.S. House of Representatives. The hill proposes that the federal minimum wages be gradually increased from $7.25/hour until $15/hour in 2025. Gusto indicates that the minimum wage will increase to $15/hour. The turnover rate drops from 70% to just 41% (at the federal minimum wage). (Castillon 2019) Knowing the turnover rate is affected by the company as well as how long an employee stays at a particular company can give a good indication of the amount that employers pay their employees.
Although living in the United States can be an incredible opportunity, it is not as easy as most people believe. Cost of living increases every year. We are all aware of this, but it is not something that we often feel. Average people live paycheck-to-paycheck, but that’s just enough to get by. The average person lives paycheck-to-paycheck, but that is not the case. Even though 40 hours a week does not mean enough money is made to cover all expenses, many workers are forced to work even more to keep up with the demands of daily life. According to National Low Income Housing Coalitions’ fact sheet, the average employee would have to earn $32.02/hour in order to afford an apartment with two bedrooms on average. The minimum wage is $14/hr. Working 80 hours a week on average is required to afford modest rents for a 1-bedroom home. (NLIHC, 2019)
The National Low Income Housing Coalition conducted a study in 2012 to examine the disparity between housing costs and earnings. The study recorded the number of weekly hours required by a minimum wage worker to afford standard rent on a two bedroom home. The study assumed 30% of an income was spent on housing. In order to pay rent, an individual must work 63 hours per week at minimum wage. The average worker working under 20 hours a week barely makes enough money to live. The minimum wage is still being discussed to make sure we live above the poverty line. Senator Bernie Sanders stated, “We must raise the minimum to $15 per hour. We will all work together to raise the minimum to a wage that is livable. Sanders adds, “While housing markets may have recovered in some areas, there is still a housing crisis that affects many families, particularly those with very low incomes. Nearly 11 million American families spend more than half their income on rent and utilities. It leaves little to spend on other necessities.” (Gibson, 2018,)
Our country is harming its people by providing unhealthy foods at cheap prices. These include chips, sodas and cookies. For example, a quick food salad can cost between $5 and $8. However, three burgers can be purchased for less than half of that price. What should a four-person family do when the bills they must pay are higher than their annual salary? In the final report of World Health Organization Commission on Social Determinants and CDC Health Disparities and Inequalities Report they identified income to be a significant factor influencing individual, family, and community health outcomes. Studies show that raising the minimum wage is a good way to improve people’s health. According to new information from Kaiser Family Foundation, low-income individuals experience disproportionately adverse health outcomes. They are more likely than others to suffer chronic illness or disability, as well as a reduced quality of life. (NCHS, 2014).
Conclusion: Minimum wage is just what it sounds like, a set amount of money that employees are paid as wages in accordance with an employment agreement. This is not the livable wages, as that is a separate amount. The state minimum wage is set by most states. Most employees rely on the help of their state government in order to make ends meet. The average minimum-wage earner relies on the assistance of the state government to ease their stress. While minimum wage is federally mandated, it hasn’t been changed or raised in more than 10 years. The House has been working to increase the minimum wages to give workers who are living or making below the poverty level a living wage. It is not yet happening, and states are doing their best until that time to ensure workers get a decent income.
Citing sources
‘A Resident’s Guide to the DC Budget.’ DC Fiscal Policy Institute, 23 Jan. 2019, www.dcfpi.org/all/residents-guide-dc-budget/.
Amadeo, Kimberly. ‘Living wage and how it compares to the minimum wage.’ The Balance, 21 Jan. 2020, www.thebalance.com/living-wage-330771.
The APHA (American Public Health Association) is a well-known organization that works to promote public health. American Public Health Association. Take action. For Health, 18 Jan. 2017, www.apha.org/policies-and-advocacy/public-health-policy-statements/policy-database/2017/01/18/improving-health-by-increasing-minimum-wage.
Ann-Simmons, Sasha. It’s not easy to pay a living wage in D.C. It’s Also Not Enough, Workers Say.’ WAMU, 3 Oct. 2019, wamu.org/story/19/10/03/paying-a-living-wage-in-d-c-isnt-easy-its-also-not-enough-workers-say/.
Barreiro, Sachi. ‘When Must Employers Pay the Minimum Wage?’ Www.nolo.com, 10 Oct. 2011, www.nolo.com/legal-encyclopedia/employers-pay-minimum-wage-law-29600.html.
‘Commission on Social Determinants of Health – Final Report.’ World Health Organization, www.who.int/social_determinants/thecommission/finalreport/en/.
Cooper, David. ‘Balancing Paychecks and Public Assistance: How Higher Wages Would Strengthen What Government Can Do.’ Economic Policy Institute, 3 Feb. 2016, www.epi.org/publication/wages-and-transfers/.
The Centre for the Study of Digital Humanities (CSDH) released a statement in 2008. Closing the Gap in a Generation: Health Equity through Action on Social Determinants of Health Final Report of Commission on Social Determinants of Health.
The World Health Organization based in Geneva. The Department Of Employment Services provides support for job seekers. ‘Office of Wage Hour Compliance.’ | Does, does.dc.gov/service/office-wage-hour-compliance.
‘Disparities in Health and Health Care: Five Key Questions and Answers.’ The Henry J. Kaiser Family Foundation, 8 Aug. 2018, kff.org/disparities-policy/issue-brief/disparities-in-health-and-health-care-five-key-questions-and-answers/.
Douglas Blake, Senior Reporter. ‘Sen. Bernie Sanders talks income inequality, education, other issues in Norman rally.’ Gale Academic OneFile Select, 22 Sept. 2019, https:/link.gale.com/apps/doc/A600429670/EAIM?u=edirect_grvl&sid=EAIM&xid=697c27ba. Accessed on 1 January 2020.
Gibson, Kate. ‘Minimum Wage Doesn’t Cover the Rent Anywhere in the U.S.’ CBS News – Breaking News, 24/7 Live Streaming News & Top Stories, 14 June 2018, www.cbsnews.com/news/minimum-wage-doesnt-cover-the-rent-anywhere-in-the-u-s/.
American Public Health Association – For Science. Take immediate action. For Health, 18 Jan. 2017, www.apha.org/policies-and-advocacy/public-health-policy-statements/policy-database/2017/01/18/improving-health-by-increasing-minimum-wage.
Keith- Jennings Brynne Vincent Palacios ‘SNAP Helps Millions of Low-Wage Workers.’ Center on Budget and Policy Priorities, 21 June 2019, www.cbpp.org/research/food-assistance/snap-helps-millions-of-low-wage-workers.
Matthew Castillon is a data scientist for Gusto. ‘70% of Workers Quit at Current $7.25 Federal Minimum Wage in ‘brutal’ Turnover Cycle.’ CNBC, 7 June 2019, www.cnbc.com/2019/09/25/70percent-of-workers-are-likely-to-quit-at-current-federal-minimum-wage.html.
‘Minimum Wage ? What It Is, Who Earns It, Federal & State Laws.’ Debt.org, 6 Jan. 2013, www.debt.org/jobs/minimum-wage/.
‘Out of Reach: District of Columbia.’ National Low Income Housing Coalition, 14 June 2019, reports.nlihc.org/oor/district-columbia.
Quinn, Mattie. Governing, State and Local Government News and Analysis. 2019, www.governing.com/topics/health-human-services/gov-minimum-wage-hike-states-social-services-savings-welfare.html.
House Committee on Education and Labor, edlabor.house.gov.
“Raising the Minimum Wage: Good for Worker, Businesses and the Economy” U.S. Congressman Joaquin Castro, democrats-edworkforce.house.gov/imo/media/doc/FactSheet-RaisingTheMinimumWageIsGoodForWorkers,Businesses,andTheEconomy-FINAL.pdf.
