The debate on minimum wage increment began a few years back and is still raging on. With many people still trying to wage the pros and cons of this action, governments keep holding back the decision. However, this is a matter that requires critical consideration.
Raising the minimum wage from $7.25 per hour to $15 per hour would bring significant changes in many households. When the Covid-19 pandemic struck, the essential services workers experienced the biggest blow with the financial implications. Since most of them work within the minimum wage, they found themselves hard-pressed, and meeting their basic needs became difficult. Even though this was when the situation became visible, their lives have been like this for a long time. Most of those who offer the most critical services in the country get the minimum salary. They end up offering services that they are not in a position to afford comfortably.
An increase in the basic pay will boost the lives of almost half of the population, helping them meet their basic needs and lifting millions to live above the poverty line. Subsequently, those depending on government funds will significantly decrease, and the funds can go to a different use. A financial impact on the grass-root level goes to a great extent. Therefore, boosting the lives of those below average will bring about economic growth. An increase in salaries is beneficial to companies and organizations since it will boost workers’ morale and make them more productive. A well-paid staff always gives their best in their work.
Despite the positivity, there are those opposing this move, especially those in the private sector. A disadvantage of this raise in the minimum wage is the increased cost of operation for firms. The raise may cause an increase in the production costs and, consequently, an increase in the price of products in the market. Secondly, some companies may choose to reduce their labor due to the increased costs and use robots and artificial intelligence instead. This change will cause many to lose their employment, therefore lacking a source of income. In addition to that, there is a concern that due to more money in the hands of people, the general cost of living will increase since people will be willing to spend more.
With the pros and cons in mind, the authorities should weigh properly and adjust accordingly. The decisions on the issue should be one that will bring forth the greater good.