Is raising minimum wages the answer?
I was reading an article from The Economist in favour of raising minimum wages in the U.S. that compares how other countries do it versus the U.S.:
Britain’s experience offers another set of insights.
The country’s national minimum wage was introduced at 46% of the median wage, slightly higher than America’s. […] Before the law took effect, worries about potential damage to employment were widespread. Yet today the consensus is that Britain’s minimum wage has done little or no harm.
The most striking impact of Britain’s minimum wage has been on the spread of wages.
Not only has it pushed up pay for the bottom 5% of workers, but it also seems to have boosted earnings further up the income scale—and thus reduced wage inequality.
Wage gaps in the bottom half of Britain’s pay scale have shrunk sharply since the late 1990s.
Wage inequality fell more for women (a higher proportion of whom are on the minimum wage) than for men and the effect was most pronounced in low-wage parts of Britain.
…and it made me think of something else:
Perhaps if minimum wages were higher in North America, people wouldn’t feel the need to try and go into student debt to the tune of $25,000 to get a college degree that is for 75% of people, essentially useless.
Currently there is far too much supply (too many eager college grads) for the little demand that exists for really good jobs.
If minimum wage was higher, maybe it’d help the economy in general by not forcing heavy debts on those who cannot afford or use it, and to provide a living wage by doing the jobs that are already readily available and meant for most of the population.
(That and perhaps also implementing universal healthcare, as you already know how I feel about healthcare not being universal in the U.S.)
The downside to all of this, of course, is that people fear those minimum wage jobs will move overseas.
Maybe not as much as you think.
You still need people on-shore to serve burgers and stock shelves, it can’t be done by a cheaper-than-an-apple-by-the-hour group of foreigners working offshore in another country.
Which by the way, doesn’t always end up being a good deal, and anything too-cheap can harm us as consumers in the end:
At any rate, I am all in favour of raising the minimum wage as it falls in line with the economy.
Otherwise, the gap between the rich and the poor grows wider and wider, and society has other negative effects to deal with as a result.