Minimum Wage Essay - Essay Prowess

Minimum Wage Essay

  

The Problem

In the contemporary society, the number of people seeking employment has increased significantly across the world. However, the numbers of jobs opportunities have increased at a relatively slower rate. Since the July 2009 reset, the minimum wage has remained $ 7.25. However, American Samoa is among some of the territories across the United States exempted. According to the Fair Labor Standards Act (FLSA), all the employees are entitled for over time after working for more than 40 hours in a week. The act does not stipulate the overtime pay for weekends and rest days. This act, which applies to the work week days has been overlooked my several employees across different regions in the United States. While the government is attempting to intervene to safeguard employees’ interest through advocating for overtime pay increase, opponents of the move support the decision by most organizations to retain minimum wage for overtime workers constant.

Cause

The main cause of disparity is minimum wage is variation in the laws across states. For instance, in Pennsylvania, minimum wage act does not include overtime pay for the workers engaged in bona-fide administrative, executive, and professional roles that are remunerated on salaried basis rather than hourly wage. In California, employees are compliant with the overtime requirements of California Minimum Wage Act and regulations. The employees must comply with the states regulations even if the new rules particulate that federal law does not affect implementation of state overtime requirement. In July 2015, the federal government mandated a nationwide minimum wage of $ 7.30 per hour (Slater, 2016). Between 2014 and 2015, nine states revised their minimum wage upwards through automatic adjustments. In 11 more states, the increase was enforced through ballot and legislative changes. In March 2014, Connecticut approved a legislation of increasing minimum wage from $ 8.65 to $ 10 by 2017.  Connecticut is among the first states that have welcomed president Obama’s call for minimum wage increase. In spite of these efforts, the topic of minimum wage among overtime workers has remained widely debated for years. Presently, additional pay for overtime in most organizations remains a matter of agreement between the employer and employee. Consequently, staffs that work for overtime hours are mainly exploited through poor pay and undesirable working conditions. This essay argues in support of the perception that minimum wage should be increased to enhance survival in today’s world.

Facts

According to the recently published estimations, over 65 % of have worked for minimum wage at some point in their career. In 1995, over 4.9 million employees worked for minimum wage or below the minimum wage. The group of employees that worked for minimum wage during this period represented 7.63 % of all employees that were remunerated on hourly basis.  When Clinton administration wage rate was implemented, 11.9 million workers earned minimum wage of $ 5.16 hourly (Slater, 2016). Some analysis reveal that the actual number of workers earning minimum wage is essentially higher because the government only counts individuals that are salaried on hourly calculations. Recently, the June 2016 reports released recently revealed an increase of payroll jobs by 224, 000 and a reduction of national unemployment rate to 5.4 %. Unfortunately the wages for the overtime workers remain flat at $ 24 per hour (Smith, 2015).

Solutions

Solution 1:

There is need for enforcing Federal law for night workers that standardizes how each state and industry pays their workers. This intervention will address the disparity and wage gap that has been experienced across different states. In its intervention, the federal government should specify repercussions for noncompliance in order to ensure that all employers adhere with the legislation stipulations (Slater, 2016). The new law should ensure that all the the States across the United States should follow the example of New York and California effort to increase Minimum Wage to ensure uniformity.

Refutation

Refutation 1: Economists are against the decision of increasing minimum wage

However, economists claim that such authorized increases are more harmful than beneficial as they negatively affect the same groups of people that are thought to be helped by the increases. According to Joseph Sabia, who is a labor economist, the statistical research does not find any evidence of beneficial impacts of the wage increase (Scheiber, 2016). However, these economists insight is refuted by proponents that claim that minimum wage should be increased to compensate for adverse work schedule. Night shift workers experience what can be regarded as the most adverse work schedule. Therefore, it has been postulated that one of the reasons that workers opt to work during the night shift and overtime hours is to benefit from the competing wage differential. Nevertheless, in areas characterized by poor local economic conditions, jobs are comparatively scarce. As a result, the reimbursing wage differential may be a less motivating factor that influences selection of nighttime and overtime work. Notably, compensative wage differentials are mainly explored using wage regression. Therefore, using this approach, employees’ wages are modeled as a function of job and worker characteristic. Although this evaluation concludes that employees working on overtime schedule need to earn more financial benefits than their normal schedule counterparts, the recommendations have not been implemented in most organizations. The outcome is a term of demotivated employees that fail to deliver according to organizational expectations (California Legislation, 2016).

Refutation 2: Increased Minimum Wage will worsen living Standards of those who lose employment

In spite of this argument against increasing minimum wage, it is obvious that the move will be beneficial to workers that have been previously exploited. Ideally, those that stand to benefit are more than a few that will lose if minimum wage is increased. Since 2015, remuneration in Nebraskaland Inc has increased to $ 15. The outcome of this pay increase has been desirable as workers are highly motivated and productive in their respective positions (Weissman, 2016). At the same time, these workers are willing to work for overtime hours and holidays without reducing their productivity doe to fatigue and boredom. A similar trend has been experienced in Seattle, where the minimum wage has increased from $ 9.46 to $ 13within a year. This increased has improved the living standards of workers, mainly drawn from poor family backgrounds.

Conclusion

The issue of minimum wage remains widely debated in the United States.  Although the government has always advocated for minimum wage increase, this measure is yet to be implemented by most organizations, economists claim that while increasing minimum wage could directly benefit employed individuals, the move could adversely affect the economy due to increasing spending by organizations and increasing unemployment. However, after weighing the positive and negative impacts, it is arguable that increasing minimum wage could positively affect the low and minimum wage employees. The minimum wage setting policies should ensure that the set amount is affordable to employers to reduce the cased of dismissing some employees as a result of increasing cost of production.

References

California Legislation. (2016). Information about California’s recent MW legislation. Employment. http://www.nytimes.com/2016/03/29/business/economy/15-hour-minimum-wage-in-california-plan-has-some-worried.html?_r=0

Scheiber, N. (2016). A bold economic experiment begins on the minimum wage. Employment. retrieved from http://www.theglobeandmail.com/report-on-business/international-business/us-business/in-us-a-bold-economic-experiment-begins-on-the-minimum-wage/article29546336/

Smith, L. (2015). Reforming the minimum wage: Toward a psychological perspective. American Psychologist, 70(6), 557-565. doi:10.1037/a0039579

Slater, J. (2016). State Minimum Wage Chat. (2016). State Minimum Wages | 2016 Minimum Wage by State. Retrieved from http://www.ncsl.org/research/labor-and-employment/state-minimum-wage-chart.aspx

Weissman, S. (2016). Should we raise the minimum wage? Employment. Retrieved from http://www.theatlantic.com/business/archive/2013/12/should-we-raise-the-minimum-wage-11-questions-and-answers/282326