Increase in Minimum Wage (Essay Sample)

Increase in Minimum Wage Student’s Name Institutional Affiliation Increase in Minimum Wage The views clamoring for an increase in minimum wage are becoming louder each day. The opponents of this move argue that the move would only hurt the poor. Indeed, it would take away their jobs, keep them on welfare benefits, and only encourage those in high school to drop out. Research indicates that a move to increase the minimum wage would lead to businesses responding to increased costs through lowering employment numbers, especially for the low-skilled personnel. Moreover, some businesses would be forced to pass the increasing cost of wages to consumers. In fact, economists have gone ahead to study the job-destroying elements of an increased minimum wage. Deontological ethics concerned with what is right or wrong can be used to analyze the issue of increase in minimum wage. Ideally, it is clear that an increase in the minimum wage is morally unjustifiable since it only results in more oppression of people through job losses, hurting of low-skilled personnel, and higher prices for consumers. An increase in minimum wage would result in a significant level of job losses in the country. In fact, estimates have been provided of increasing the minimum wage. Through this, it has become clear that the jobs that would be lost are mostly entry-level positions. Kantian ethics on categorical imperative highlights the preeminence of rights, obligations, and justice in regard to individuals illustrating that the end does not in any way justify the means. It would mean that some means cannot be deemed ethically allowable regardless of their purpose. Although raising minimum wage may be seen as a worthy course in isolation, it leads to job losses. In this regard, through the destruction of entry-level jobs, an increased level of minimum wage hurts the lifetime income prospects of the low-skilled laborers. Through a study done by the National Bureau of Economic Research, an increase in the minimum wage level between 2007 and 2009 from $5.85 to $7.25 led to declining employment chances for low-skilled laborers by almost 6% (Simon, 2016). It means that the low-skilled workers, those aged between 16 and 30 years old, with little experience and have only attained a high school diploma would lose their jobs due to an increase in minimum wage (Simon, 2016). In the year 2014, an analysis was done through the Congressional Budget Office assessing Obama’s idea to increase the federal minimum wage by the second half of 2016 (Simon, 2016). The report divulged that the move and implementation of the proposal would lower total employment by 0.5 million employees in spite of uplifting almost a million individuals out of poverty (Simon, 2016). The research also divulged that the wage increase would alleviate some low-wage jobs. Indeed, it would be immoral to render people jobless and discriminate some that are lowly-skilled. Therefore, it is morally unjustifiable to increase the minimum wage. Another consequence of raising the minimum wage in the country would be unprecedented hike in consumer prices as businesses strive to cover for the rising wage costs. Raising the minimum wage would hurt employers, especially those running small family and midsize entities (Kelly, 2019). They will become disproportionately hurt by the additional costs they would have to incur due to increased wages. Furthermore, the local neighborhood outlets and entities earning razor-thin profits will be propelled to increase the prices of products as a way of making up for extra labor costs. With hiked prices, consumers may opt to take their money elsewhere (Kelly, 2019). In effect, this would translate to mean lost customers for businesses, which would mean losing revenues. Such businesses will eventually lay off their employees. A study done by Purdue University divulged that paying fast-food restaurant workers $15 every hour would result in increased prices. In fact, the research revealed that prices in such businesses would increase by around 4.3% (Wihbey, 2016). A paper from the University of Leicester revealed that companies tend to react to minimum wage increases not by lowering the production level or employment, but by heightening prices. In general, price increases tend to be modest with this rise in minimum wage. For instance, a 10% rise in minimum wage would raise the food prices by no more than 4% and the overall ones by no more than 0.4% (Wihbey, 2016). Ideally, a rise in prices due to minimum wages will be a disadvantage to consumers since they would have to spend more. Therefore, it would not be morally justifiable to increase the minimum wage. The other reason why a rise in minimum wage is not justifiable is that it only results in very minimal poverty reduction and only renders many over-reliant on welfare benefits in the country. It would mean that other low-wage laborers would become jobless as many employers would have to lay them off due to high cost of wages (Simon, 2016). The result would be lowered household income, which would place many families below the poverty line. Utilitarian ethics tend to regard the issue of pay ore as an issue of attaining the most productivity in an ethical way. It is the theory of the greatest good for the biggest number. In this case, an ethical action should be one that brings happiness to the largest number. Increasing the minimum wage does not work in line with this ethics since it alienates the low class and benefits a few. Indeed, this would adversely affect the low-skilled workers that would have to endure massive job losses and find decreased opportunities in the novel labor market. In fact, this aftershock would gradually spread to individuals joining the workforce (Simon, 2016). The variation comes in the sense that the minimum wage is usually poorly targeted since some of the laborers that would benefit from a rise in minimum wage originate from middle-class families (Cooper, 2017). The move should be one that prevents exploitation of employees, regardless of their family income level. The sepa...