The Minimum Wage Bottle | Analysis on Why America Needs To Raise The Minimum Wage

 I earn a minimum wage to film athletic events on campus. But Saint Mary’s gives a federal college work study scholarship for students who work on campus. I am awarded two thousand two hundred dollars for working on campus. This is truly a blessing for the expenses students have to pay for attending Saint Mary’s. I am thankful and glad I can attain the federal college work study scholarship, but minimum wage workers don’t receive these benefits. In fact, they sacrifice more than we realize. Although a rise in minimum wage will result in job loss, workers deserve a higher quality of life. 

The current minimum wage in California is ten dollars an hour. In 2015 it was nine dollars an hour. Labor unions have been battling the government for a higher minimum wage. The labor unions have finally won. The California legislature agreed to raise the minimum wage to $15 by 2022 and for smaller businesses by 2024 (Tsao et. al 2016). It is a dramatic and necessary increase for minimum wage workers. There are 6.5 million workers earning less than $15 an hour (Durham 2015). They represent over 43% of the workforce (Durham 2015). Life should have quality for all human beings. The $15 minimum wage supports families and respects the workforce.

Before working on campus, I worked at the Safeway in Moraga California. They explained to me that I would have to pay five-hundred dollars to the Safeway labor union in order to work at Safeway and receive employee benefits. I knew I could pay the fee, but I calculated how many hours I would have to work to pay it off. After my calculations, I found I would have to work over sixty-hours to pay the fee. Safeway terminated me as an employee because I refused to pay the union fee. They warned me every week and I purposely lied telling them I would eventually pay. But four months later, they let me go. I will not support a labor union that gives ten dollars an hour to their workers. A labor union’s purpose is to support their employees by giving them a higher quality of life and protect the rights and health of their workers. 

 I worked there for four months, and realized I was living in someone else’s dream. All minimum wage workers don’t dream of earning an unlivable wage. After the last day of working at Safeway, I talked to my fellow coworkers about how frustrated I was with the amount of money we were earning. Then Mickey, one of my good friends from working at Safeway, turned to me and said: “This is someone else’s dream. Were just living in it.” He was right. No one understands the reality of the minimum wage unless they experience it themselves. It is the dark reality of our world and we are ignorant on how the majority suffers from the minimum wage. The majority has become the minority against authority. 

Should workers have to pay their own income to have support from the labor union? It was frustrating to discover I wouldn’t be earning a positive income until I worked at least eighty hours. Safeway also required employees to wear certain color shoes, shirts, and pants. My shoes and pants cost thirty-four dollars, and my shirt was eleven dollars. So I would have to had pay (If I paid the union fee) almost six hundred dollars. How can the labor union not afford to give their employees clothes? I didn’t trust my labor union and I will never trust Safeway because of how the company ridicules their employees. 

The four months I was at Safeway was between the fiscal year and change in the minimum wage. I started in November, and was fired at the end of February. I reviewed my paychecks and calculated the difference between my nine dollar an hour income to my ten dollar an hour income. Based on my average twenty eight hour work week, I gained twenty eight more dollars per week. This is a tremendous difference, because if I worked for a whole fiscal year, I would gain a thousand more dollars. A full-time worker would earn over two thousand dollars a year. Let me emphasize, that increasing the wage by one dollar would significantly decrease the amount of poverty in the United States.

 Mincy agrees with increasing the Minimum wage because there are studies showing it will reduce poverty. Mincy explains: “For ways to reduce working poverty that do not affect the Federal budget, poverty specialists still favor a higher minimum wage (18).” After Mincy completed his research, he found that raising the minimum wage will reduce the percentage of poverty in the United States and explained: “If full coverage and compliance accompany an increase of the minimum wage, the poverty gap among families with at least one low-wage worker falls by eleven percent, and the number of such families falls by nine percent (24).” This research performed by Mincy, clearly supports that the minimum wage has the potential of decreasing poverty among low-income families and individuals. Although this research studied the rise between a $4.25 minimum wage to a $5.25 minimum wage, it supports that raising the wage only a dollar can potentially decrease poverty in the United States.

There are more benefits from raising the minimum wage than only reducing poverty, it can also improve the health and welfare of minimum wage workers. Tsao performed a study to discover if raising the minimum wage would reduce the amount of premature deaths in New York City. Tsao explains that: “A $15 minimum wage could have averted 2800 to 5500 premature deaths between 2008 and 2012 in New York City (5).” The deaths are recorded in low-income communities and African-Americans are the majority who face this dramatizing reality. Tsao states: “Most of these avertable deaths would be realized in lower-income communities, in which residents are predominantly people of color (5).” Durham another researcher studying the minimum wage explains that: “Although the minimum wage mainly affects young teenagers, after the age of thirty, non-white individuals are the majority who earn a minimum wage income (12).” Under the system of white supremacy, the diverse population in the United States is faced with limited privileges and constrained economic freedom. Durham is simply stating how the majority of minimum wage workers are constrained in a system that is impossible to escape, unless they are given an opportunity to earn a higher amount income.    

 

One of my coworkers at Safeway, Spencer Raymond, is a twenty-six year old African American who cannot escape the minimum wage system. Spencer is frustrated with how we cannot escape the system. He explains that: “It’s bullshit, I work forty hours a week and don’t even earn four hundred dollars.” When Spencer was twelve years old, his parents filed for divorce. He’s father left him and his mom moved to Texas with her boyfriend. “My parents leaving me was tragic, but at the same time, I became a stronger human being and luckily my Aunt saved me.” Spencer has been living with his Aunt since his parents left him. “I didn’t want to be an obligation with my Aunt. I started working as soon as the law let me.” But Spencer’s friendships put him on the wrong path. 

He was skipping school and he dropped out of his sophomore year. “I felt the world was against me. Drugs made me cope with my internal anger, the stress of having no family, and no hope for escaping the poverty I was and still in. I started to question whether life was worth living anymore.” Spencer’s Aunt forced him into rehab. Spencer explains why it was a big step in his life: “I didn’t have a choice and although I was frustrated by it, I realize now my Aunt was doing what was best for me. I’ll never forget that.” Spencer eventually overcame his drug addictions and went back to McClymonds High School in Oakland. 

He explains how the transition back to school wasn’t that easy for him: “It was tough going back to school. But I started playing basketball and running track. I use basketball now to cope with my internal anger.” Spencer loved competing in sports and wished he played sports earlier in his life. Spencer planned on going to college, until he saw the expense of it: “I decided I was going to earn some money and then go to school. Little did I realize that my dreams would never come true.” Spencer explains how the job didn’t help him earn much money for him to go to school: “I got a job pretty quick, but a few months later my Aunt started getting sick. And suddenly I realized I now had a responsibility.”

 Spencer had difficulty with his own health. He explained it by relating to how I was feeling working at Starbucks: “Remember Z, when you were exhausted and pissed off at the end of a day’s work? Think how mad you were and multiple that by one hundred, then you will know how I feel. I was so mad because I couldn’t help my aunt at all.” Spencer reflects on how much he was earning per week: “I earned a little over three hundred dollars a week and my aunt’s medication was over one thousand dollars because we didn’t have insurance.” There are events that correspond in life that we cannot control, this is key and I must reiterate that because of the minimum wage level, Spencer is unable to help himself and his sick Aunt. Spencer continuously smokes cigarettes to get through his life. On a national scale, think of how it mentally affects us. We cannot fear raising the minimum wage, because there is already clear damage by the current minimum wage.

Today, Spencer pays for rent to live at his Aunt’s, because: “She’s feeling better, but I have to support her, because it’s now more expensive to live in Oakland and she can’t afford it with needing medication.” I asked Spencer how he will try and maybe attend college to escape the system of the minimum wage and he answered: “Honestly I don’t know, but I’ve found a passion. I love to rap. When I’m not at work I dedicate my time to music. I’ve got some shows going for me as you know, It’s the only way I can see myself escaping this shit.” Spencer has been stuck in this system for over a decade. Raising the minimum wage will offer him freedom and opportunity to do his passion and possibly attend college. Raising the wage will make him become a more enlightened individual, and therefore correspond to make us a more enlightened society.

It is clear there is an authoritative system taking advantage of low-income workers. Some argue are against raising the minimum wage. Oren Levin-Waldman and Charles Whalen point out why people oppose the minimum wage:

a wage hike hurts low-wage employees by resulting in lost jobs. That is because raising the wage floor is said to encourage employers to substitute skilled workers for their least-skilled employees. Especially for low-wage workers in small business, a minimum wage increase means layoffs or benefit cuts. They also argue that most minimum wage-workers are not even primary earners; rather, they are high school students and other secondary earners in a household. With only 2.5 percent of the labor force earning the statutory minimum wage and most of them believed to be teenage secondary earners.

(59-60)

There are many issues with this argument. First, a majority of teenagers earn a minimum wage because they are trying to earn an income to advance their career by going to college which in order to attend you need money saved or the government will allow you to take thousands upon thousands of dollars of debt. It is clear that the younger generation works a minimum wage, but without raising the wage, we increase the wage gap between the elite and the poor. Despite the loss of jobs resulting from rising the minimum wage this will decrease the poverty line and reignite the dying middle class. Oren Levin-Waldman and Charles Whalen also point out the flaws of their argument: “Increasing the wage floor is not primarily about helping the poor but about shoring up the middle class… Economists usually rely upon neoclassical theory to predict the effects of minimum wage increases (60).” Increasing the wage floor improves the income of the poor and the middle class. Therefore, the elite class losses from the minimum wage rise. Since there is a great difference between wage income in the United States, there is also a strong indication of inequality.

Charles Whalen and Oren Levin-Waldman discuss how labor market institutions are facing a minimum wage issue. “In recent years, it has increasingly become clear that labor market institutions and the minimum wage may have a role to play in achieving greater equality in the wage distribution (62).” Reconsidering the minimum wage as a middle class issue would raise a stronger concern of the minimum wage, because it is a higher percentage of the labor market. Whalen and Levin-Waldman, through their research, believe and discuss the necessity of raising the minimum wage to benefit the middle class and essentially bring more equality among the United States. “Rethinking the minimum wage as a middle-class issue can attract broader attention and increase public support for a meaningful minimum wage. The move toward a more sensible real-world wage policy would almost certainly follow (68).” Charles Whalen and Oren Levin-Waldman characterizing the minimum wage as a middle class issue, in hopes that it will create a more sensible reason to raise it. Raising the wage floor will raise the income of the middle class and create opportunity for low-income workers to attain middle class status.

Dwight R. Lee, a professor from University of Georgia, implies his study and many other studies, see a small reduction in unemployment when the minimum wage is raised. And he explains that: “many studies suggest that the effects are indeed quite small, with a ten percent increase in the minimum wage causing far less than a ten percent decrease in employment, with little increase in unemployment (657).” Lee is criticizing the people who believe there will be a dramatic raise in unemployment. He is emphasizing there is a small effect on employment when the minimum wage is raised and Lee also explains that it will only lead to more economic opportunity for those who earn a minimum. “When employers have some monopsony power, it is possible to increase employment by imposing a minimum wage (657).” Lee is suggesting raising the minimum wage enhances the power of minimum wage workers. This also may lead, as Lee explains, to a higher productivity among the minimum wage workforce. “A higher minimum wage could conceivably increase worker productivity (motivating workers to improve their skills) enough to offset the negative employment effect of the higher wage (658).” The productivity of workers will increase because the market would become more competitive and workers will be motivated to have an opportunity to escape the minimum wage system. 

From an economic standpoint, this would also decrease the disparity between the elite class from the middle and poor. As Lee has discussed, if an increase of the minimum wage leads to workers having higher monopsony power and better productivity, unemployment would be reduced. Lee explains that he supports this notion and that it endangers employed workers: “I shall argue that increasing the minimum wage can reduce unemployment and employed workers are harmed when this occurs. Because employers can offset the effect of a minimum wage increase by reducing employee benefits (658).” There are probable consequences that may follow from the minimum wage, but the slow rise will overcome these consequences. For instance, would billion dollar corporations lose money from raising the minimum wage? They wouldn’t lose much profit at all. The federal bureau state the following: “After raising the minimum wage from $7.25 to $9.00 in 2009, the unemployment rate rose slightly and billion dollar corporations lost an average of one million dollars in profit (1).” We don’t realize the amount of wealth corporations take from their employees, because the elite keep it for themselves. For instance, Phil Knight, the chairman of Nike, in 2015 currently has over 20 billion dollars. This is not economic justice, it is attaining the highest level of profit, with paying the minimum wage.

Ronald has other facts that equate to why the minimum wage needs to be raised: “In 2012, 1.984 million were paid below the minimum wage (1).” There are conditions that allow businesses to pay under the minimum wage such as: “(1) Workers are paid tips, (2) full-time students, and (3) all workers under the age of 20 in the first 90 days (1).” Are these conditions necessary for business to be successful? Absolutely not. And most Americans want the minimum wage to rise: “A Gallup survey in 2013 shows 71% of Americans increase, including 54% of conservatives (2).” Majority of both branches of politics want to see a raise to the minimum wage, because we see how much wealth that elite class withholds from the minimum wage class.

Researchers, such as Lee, fear raising the minimum wage will result in loss of employer benefits. “An increase in the minimum wage can reduce unemployment clearly depends on the assumption of some lumpiness in the provision of fringe benefits (664).” This is a concern but raising the minimum wage will allow workers to cycle out and receive higher paying jobs that will give them employer benefits. A minimum wage job should only be temporary; no one should have to work a minimum job their whole life. What is important is giving everyone economic opportunity, raising the wage will certainly accomplish that.

Kotval’s study of the U.S. Virgin Islands, might have discovered a living wage standard and Kotval explains his findings: “The research results are consistent with findings from other studies… A modest number of workers and their families also benefit from wage gains… The real question centers upon who benefits and who pays. Given the annual increase in tax revenues in good times, there is the ability of the Government to cover those costs (554).” There is an issue with trusting our government. We are reluctant of where our taxes go. And what we don’t realize is how much our income goes into taxes. Raising the taxes will lead to more money for the government and the minimum wage workforce. It is a win-win situation for both the government and low-income workers.

Kotval and his colleagues give three recommendations on what level the minimum wage should be, and how the living wage should be mandated: 

(1) Mandate the $12/hour wage for all government workers, (2) At $12/hour the USVI (United States Virgin Islands), is already paying 30% higher than the regular minimum wage ($9). Raise the wage at a steady ratio. Lastly, consider raising the minimum wage to $15 an hour in three years. For this increase would impact 15% of the government workforce and yet be absorbed within the present revenue trends (554).

Kotval and his colleagues believe the federal minimum wage should be at $12 an hour, because the wage will not impact employee benefits and cause a spike in unemployment. They also think a steady rise of the minimum wage is necessary to avoid economic collapse among small businesses. For small businesses in California, the $15 minimum wage will not be in effect until 2024; this is a steady rise of the minimum wage. Although it is going to take eight years for the wage to rise among all businesses, it is clear that California is raising the minimum wage slowly to allow businesses to adjust to the change. 

Silvia Marginean and Alina Stefania Chenic, also describe how there is no negative effect on employment when raising the minimum wage: “After many years of empirical research, studies seem to point fairly uniformly to the existence of small negative effects of higher minimum wages on employment and unemployment (96).” These researchers think this is the case because of Addison’s study in 2013, further supports this notion. “Addison (Addison et al., 2013) shows that even in a deep recession minimum wage increases do not appear to have a particularly strong effect in reducing employment (97).” His study indicates where we are in the economy, raising the minimum wage still doesn’t reduce employment. Addison’s study further justifies raising the minimum wage won’t reduce employment in a recessed economy. 

Unlike other scholars, Marginean and Chenic believe to understand the argument of the minimum wage, it must be studied at an international level. These authors explain why this is necessary: “Any study on the effects of raising minimum wage has to be conducted at a national level because the effect depends on the share of minimum wage paid workers, the relative minimum wage, studies focusing on groups of countries are in most cases irrelevant (101).” There is a small amount of literature on the minimum wage at a national level. But it is key to broaden our understanding of what effects the minimum wage has on a global scale. For instance, in the United States it is not relevant to study the effects of raising the minimum wage based on teenagers, because the proportion of teenagers in workforce is low. We must further investigate the minimum wage and discover the wage that gives economic justice to both the employer and employee. 

After reviewing the literature of the minimum wage, it is clear a raise is necessary for workers. They are trapped in a minimum wage system unable to escape. We cannot be unfair and make America a world of survivability; America is a vision of quality and freedom yet the minimum wage overshadows this vision. The elite must sacrifice their wealth to their employees so we can become an enlightened society. We cannot allow low-income workers to be trapped because no one dreams of living someone else’s dream. A quality life is allowing an individual to do what they love. Raising the wage will allow more opportunity for individuals to live a quality life, rather than a meaningless life.

 

My experiences of the minimum wage spoke the reality of it. My eyes saw the implications and issues the wage has with not only my coworkers, but with society. My privileges are frustrating because luck is what gave me my privileges. I was born in a system that benefitted my identity, but not so much for others. Others are not as fortunate as I am, and those who are not as fortunate don’t deserve to be trapped in an under privileged system of authority. Change must happen for the purpose of humanity. We must remember to care for one another. Raising the minimum wage brings out new ideas, new creations, and lastly, civility for all. Raising the wage directs us to the purpose of human life: accomplishing tasks to better others rather than ourselves. This is a matter we can no longer be silent about. For our lives begin to end the day we become silent about things that matter. 

Works Cited

Durham, C. D., & Baurer, E. (2015). U.S. Department of labor final rule raises minimum Wage 

for federal contract workers. Employee Relations Law Journal, 40(4), 47-49.

Kotval, Z. Kotval-K, Z. Machemer, P., & Mullin, J. (2012). A living wage standard: A case study of 

the us virgin-islands, Sage Publications, 27(5), 541-557.

Lee, R., D. (2004). The minimum wage can harm workers by reducing unemployment, Journal of 

Labor Research, 25(4), 657-667.

Levin-Waldman (2014). A conservative case for the minimum wage, Challenge, 57(1), 19-40.

Levin-Waldman, O., & Whalen, C. (2007). The minimum wage is a middle-class issue, Challenge, 

50(3), 59-71.

Marginean, S., & Chenic, A. S., (2013). Effects of raising minimum wage: Theory, evidence and 

future challenges, Elsevier, 23(7), 22-30.     

Mincy, B. R. (1991). Raising the minimum wage: Effects on family poverty, Monthly Labor 

Review, 113(7), 18-25.

Risher, H. (2013). Facts on the minimum wage, Compensation & Benefits Review, 45(1), 7-17.

Stevans, K. L., & Sessions, N., D. (2001). Minimum wage policy and poverty in the united states. 

International Review of Applied Economics, 15(1), 65-75. 

Tsao, T., Konty, K. J., Van Wye, G., Barbot, O., Hadler, J. L., Linos, N., & Bassett, M. T. (2016). 

Estimating potential reductions in premature mortality in new york city from raising the minimum wage to $15. American Journal of Public Health, 1(6), 1-12