The Minimum Wage Debate

Julia Ferrara

March 2, 2020

According to the Wall Street Journal, countless businesses agree that there

should be an increase in the minimum wage. Many business owners and employees do

not believe that $7.25 is sufficient, nor an eye-catching number. However, few

businesses think that Biden's plan to raise the minimum wage to $15.00 an hour may

be excessive.

           The increase of minimum wage would affect small businesses rather than large

businesses. To begin with, most companies pay employees above the federal minimum

wage floor, but not by a significant amount. They want their employees to have an

incentive to work towards earning more in the future. Raising the minimum wage

to $15.00 an hour would be economically inefficient. Yes, it pleases employees to see

that amount of money, but it will hurt small businesses. Most of those employees

working at those small businesses will be laid-off due to the company not being able to

afford to pay them. According to the Wall Street Journal, "…only 20% of its members

employ workers who pay the federal minimum wage. But it forecasts that a $15-an-hour

level would cause 900,000 jobs to be lost at businesses with fewer than 500 workers"

(Haddon & Morath). It will be difficult for small businesses to raise their fixed payments

due to the inability to conform to increase labor costs. They would have to lay

employees off to meet Biden's desire to have the minimum wage be $15.00 an hour.

           Another factor that needs to be considered while Biden plans to raise the

minimum wage nationally is the individual states economic situations. Every state has a

different cost of living. For example, if you compare the cost of living in Alabama to Long

Island, Alabama would be much lower. To continue further, different parts of each state

need to be considered as well. For instance, New York state is composed of upstate

New York, the five boroughs, and Long Island. Each of those areas differ in how much it

costs to live there, and if we break it down further, those neighborhoods within each part

have different economic classes. As illustrated in the article, Rebecca Hamilton, agrees

that the minimum wage should be raised to $15.00 and that the current minimum wage

of $7.25 is inadequate. However, she then further contradicts herself by saying New

Hampshire has a lower cost of living. 

           President Biden' plan to increase the minimum wage to $15.00 an hour is

affordable for large businesses and certain parts of the United States. However, it is not

for small businesses and other regions. The proposal to raise the minimum wage needs

to be further discussed to see if it is economically efficient for the entire country or only

certain groups.

Work Cited:

Morath, Eric, and Heather Haddon. “Many Businesses Support a Minimum-Wage Increase-Just Not Biden's $15-an-Hour Plan.” The Wall Street Journal, Dow Jones & Company, 1 Mar. 2021, www.wsj.com/articles/many-businesses-support-a-minimum-wage-increasejust-not-bidens-15-an-hour-plan-11614604077.