Performance-Based Pay: Abolishing the Minimum Wage (Essay Sample)

Performance-Based Pay: Abolishing the Minimum Wage
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Performance-Based Pay: Abolishing the Minimum Wage
Putatively, the freedom to negotiate pay would expose workers to exploitation. In response, many states have established the minimum wage, which stands at $7.25 per hour in many states in the United States. Some cities and states have modified the same, although none goes below the legal base. For a long time, there have been questions of whether the minimum wage should be abolished to encourage performance-based pay. The minimum wage should not be abolished: it provides the incentive required to seek employment, improves a nation’s productivity, and steers economic growth.
As an incentive, the minimum wage inspires people to seek employment and work for a long time. By guaranteeing a minimum payment, the minimum wage encourages those without skills to work in a particular field and the unemployed to find work and start self-provision (Neumark, 2018). Doing so reduces poverty that burdens many economies and hinders socio-economic growth. Setayesh (2018) further found that the minimum wage, as an incentive, leads to quick absorption of part-time workers when a vacancy emerges. Hence, it promotes employment and cushioning workers from exploitation and should not be abolished.
Besides encouraging employment, the minimum wage keeps people and nations productive. Gossett (2018) mentioned that workers guaranteed a known pay use it for self-development, mainly through investing in education. Such developments make a nation’s labor pool to be more attractive. In the same case, education improves people’s skills; they become more innovative and empowered to run small businesses (Bell & Machin, 2018). Eventually, the productivity of creative people improves and makes them suitable candidates for higher-paying jobs- within and in foreign countries. All this self and nation’s improvement is enabled by the job security and guaranteed income that the minimum wage obligate. Based on these advantages, abolishing it would be unjustified.
The minimum wage also spurs economic growth. When there is a payment floor that employers cannot go below, many employees get paid an amount that prevents too much deviation from the national average. Accordingly, the population segment that can afford basic life increases (Gossett, 2018). Besides, having some money to spend increases the demand for common commodities. The demand grows as money accumulates through savings and investments. There should be a matching supply to meet this demand, which makes way for business establishments (Setayesh, 2018). In turn, businesses pay taxes, which governments use to support education, build infrastructure, and bring technology into a nation. All these possibilities are enabled by establishing the minimum wage; hence, it should not be ab