Is raising the minimum wage the right approach

[Qhunman]

Now I think trying to make an adjustment for minimum wage for inflation would actually be part of the problems, not the solution many might see it as a solution but with time it would not be, let all think of that if the minimum wage increases and it matches inflation, let just say employers would have to find a way to pass the cost to prices which might cause inflation, for an higher minimum wage hurts small businesses and just that lower skilled workers will suffer for that too, some companies might even get to some extent to hire less, or move to cheaper countries, now the people you want to help end up jobless…

I thought the adjustments is to curb the effect that inflation does to workers, so that they can be able to afford their basic needs and those of their family,then what do you mean when you say it would actually be part of the problem and not the solution? From what i understand about inflation is that it keep rising that is why government increases workers minimum wages from time to time to make the cost of living less difficult for workers. if increasing it would cause more problems than good, i don't think that the government would be adjusting it from time to time.

[Bitcoin Smith]

If this was a case of lack of interest in jobs or low manpower then an increase in minimum wage may solve that. It would be better to give out grants, low interest loans and support for local businesses.

Giving out loans will solve the crisis in short term but then it will increase the inflation on the longer terms so the government will reduce the fed rates that will again affect the business, and this cycle keeps on continuing... Raising the minimum wage when businesses are struggling is a bad approach because if the business can't pay those salaries, then they will fire their employees which is even worse than making something even if it less.

[Davidvictorson]

Do not believe in only what you are reading in X, you can do more research. Seattle want to increase minimum wage just because of the usual reason countries are increasing minimum wage which is high inflation in a way that everything in the country is costly already and their fiat has fallen so much in value. Other reasons can be included but this is the major reason.

Hmm... i like this and agree with it.
I have yet to see a country that increased minimum wage in a period of economic boom. Inflation and other economic woes are some of the major reasons why they raise the minimum wage.
One of the other reason may be during election period when the administration wants to rerun for office and remain continue so they need to votes of the people but still, these happens during same period.

[BIT-BENDER]

Hmm... i like this and agree with it.
I have yet to see a country that increased minimum wage in a period of economic boom. Inflation and other economic woes are some of the major reasons why they raise the minimum wage.
One of the other reason may be during election period when the administration wants to rerun for office and remain continue so they need to votes of the people but still, these happens during same period.

I actually did a research using the key word to countries increase minimum wage during economic boom and they answer was a resounding yes, infact it is more likely that a country will increase its minimum wage during the good which I think it's the usual thing.
The countries with the highest minimum wage are relatively stable countries that are obsessed with providing the best for their citizens.

[trendcoin]

Raising the minimum wage is one of the factors that perpetuates the inflationary spiral, but if the minimum wage is raised by less than the inflation rate, can we really say that the minimum wage has been increased?

I believe raising the minimum wage is the right thing to do, but only if the increase matches the inflation rate or is slightly higher. In other words, I support a real increase because, first and foremost, I don’t believe that workers’ wages are the cause of inflation or the economic crisis. Labor costs are often the smallest item on the list of total expenditures...

[WatChe]

Raising the minimum wage is one of the factors that perpetuates the inflationary spiral, but if the minimum wage is raised by less than the inflation rate, can we really say that the minimum wage has been increased?

I believe raising the minimum wage is the right thing to do, but only if the increase matches the inflation rate or is slightly higher. In other words, I support a real increase because, first and foremost, I don’t believe that workers’ wages are the cause of inflation or the economic crisis. Labor costs are often the smallest item on the list of total expenditures...

Generally its seen that salaries are not increased in accordance with increasing inflation rate. I was reading an article about Seattle's minimum wage increase and the article says that despite increasing minimum wage to $22.14 an hour in 2027, many people still won't be able to afford to live there which means this increase is not sufficent.

Inflation is affecting every class and everyone is struggling to cope up with it but the most affected are the ones who are already living in poverty and they are struggling to meet their expenses on daily basis. 

[uneng]

To raise minimum wage is a populist measure which doesn't solve any problems. If they want to solve the crisis, they have to find some way to bring value to their territory, that is, to encourage external investors to settle their businesses in Seattle, and to make the local producers sell to external buyers.

This way they will be bringing money from outside to the local economy, boosting the market as a whole and proportionating a fertile land to everyone involved on the financial interactions in daily life.

[Gozie51]

If this was a case of lack of interest in jobs or low manpower then an increase in minimum wage may solve that. It would be better to give out grants, low interest loans and support for local businesses.

You are right and one of the ways to increase cash flow in the society is to encourage individuals to go into small scale businesses at least to start with. Micro business is the fastest to go down in local communities and increase their per capita income. To do this is not by increasing their salaries because that will end up increasing inflation and bringing down the value of same money/salary that was increased. Inflation is one factor that makes money to lose value and to tighten inflation up is to decrease the amount of money in circulation not by printing money to increase recurrent expenditure like salary. Investment should be encouraged through loan especially soft loan that will span over long years before repayment. However, government must ensure that such loan are monitored for the investment purposes that it was meant for. Otherwise, people will use it for personal benefit like feeding, shelter etc.

[Judith87403]

I read that there's a drop in white collar jobs in Seattle because employers are cutting down their workforce. The problem with vast majority of people is that they depend so much on white collar jobs and working for someone instead of establishing their own businesses. In today's world, everyone needs to be business oriented and be creative enough to develop skills that can make you self-employed because if you depend too much on working for people in order to be paid salary, when the job terminates it will only throw you into a state of confusion. You must not be employed before you can earn a living. Even if Seattle increases their minimum wage, those that are currently working will be the beneficiary while those without a job will have to suffer their own fate.

Maybe the increase in minimum wage is to encourage those that left their works or not find interest in working to come back to work. Isn’t this minimum wage same amount they’ll pay to a labourer that works for them? I think it should be the same pay.

If local restaurants are being forced to pay that amount per hour, it’ll cost them too much to be able to pay all their staff salaries and pay tax, so it pushes them to also raise food prices which will affect the salary workers who claim to have had an increase in salary from the addition of minimum wage.

I think where the problem is now is who the cost will affect the most and be able to absorb it. The salary workers/consumers through paying high price, the business owners through paying more tax/pay their workers, or the workers through reduces hours of job? This could be where the real problem is.

You are not far from the truth, if businesses increases the pay of their staffs due to increase in minimum wage, it will eventually force those businesses to increase what they market to the public which will further lead to severe inflation which will appear like the increase in minimum wage didn't change anything because as they earn more they will also spend a lot of money to buy stuffs. But I thought that increase in minimum wage is only implemented in government jobs and businesses, or does it also apply for private business owners? I'm curious to know because if that's the case then increasing it will affect a lot of local businesses because they can't afford to pay their staffs hence their will be limited job opportunities.

[Leahized]

I have yet to see a country that increased minimum wage in a period of economic boom. Inflation and other economic woes are some of the major reasons why they raise the minimum wage.
One of the other reason may be during election period when the administration wants to rerun for office and remain continue so they need to votes of the people but still, these happens during same period.

Yes, his comments reflect a realistic mindset. And I agree with you that this strategy is quite effective in maintaining power administratively. Recently, such a strategy has been implemented in my country as well. The prices of everyday commodities are rising, and the expenses are higher than the financial income of the general public. Therefore, in this crisis situation, a pay scale has been given to the job holders, which has almost doubled their salaries.

In my opinion, this cannot be a solution. Because as a result, there is no improvement for the day labourers. And controlling inflation is a difficult step, which will not easily lead to economic prosperity. Therefore, the government should eliminate corruption and syndicates.

[Emitdama]

Increasing the minimum wage is going to help eventually because when they increase the minimum wage those that are working are actually going to have more money to do whatever they want, especially if they want to expand themselves by going into business.
If the minimum wage of a country is very small, it will affect the economy of the country because everyone will just be eating from hand to mouth. You can’t use your salary to start up a small business because the money they’re paying you is very small so increasing minimum wage is actually going to be of help.

To have an increase is better than not having an increase at all but I don't think what you said that they can now do whatever they want is true. It is only an increase though and not something that they are given hundreds or thousands of dollars, millions, etc... Basically a low rate country for workers, do already has a problem on their economy. I can't only imagine if all will now do a business just because they got a raise. None will work then? .

And maybe their ex-employer is now their competitor. But this is why it is unlikely for all and the reality is, doing a business is not easy even if we already have the capital. Then, there are also that just love to work for someone else than do a business on their own.

[Bright0515]

If this doesn't change the rate for inflation then there would be no need to raise the minimum wage because the masses are still not going to have enough purchasing power to actually get what they want. This approach might not bring about any positive changes to the economy.

[Dogedegen]

Inflation is unstoppable and the only way to deal with it for most of the people is to have more purchasing power and one way of having more is through increased minimum wage.

This is not right, the effect is the opposite of what you describe. Increasing minimum wage increases the purchasing power only temporarily, then causes even more inflation and the situation is back to the beginning or even worse than where it started.

For all to benefit with the raise, the government needs to adjust as well their taxation to these businesses and give incentive so that they can comply to the increase of wages.

Minimum wage is not done with incentives, it is mandatory by law. A business has no choice but to accept it, any employment that has a salary less than minimum wage is illegal.

The idea in general is flawed because it ignores the major factors in job creation.     I believe in a bare minimum setting for wages, mostly so people dont get treated like slaves which surprisingly still can happen hence it formalises the felony conditions of exploitation mostly.

   The confusion comes from forcing any wage or price to be true, in a free-market economy this is failure from day one.  The cost of labor is a commodity or input cost to a business, and it can force the business to not exist if the wage were set too high.  So min wage can destroy jobs, reduce opportunity and raise unemployment, its an ironic effect that follows over governance as has been proven countless times.

  If government wants to create an absolute barrier and its far above the lows, gov must pay the difference to ensure no restriction occurs to business. It can't be another tax on jobs, in some cases a business automates the jobs using machines or exports the labor process abroad to ensure a low cost of labor.  Force most often fails, gov can subsidize a final wage in some way and control the budget itself in that way.

That is correct, this is a death sentence in free-market economy but it seems that many still believe in these kinds of ideas. I guess this is one of the reasons why life has been getting worse and worse for the middle class in the recent decades in the most developed countries. They continue to adopt some ideas every now and then that makes them less competitive and that cause negative friction in a free-market economy. We need actual solutions that handle the issue long-term, and not ideas that are like short term band aids and that come back even worse after some time..

[Crypto_Timothy]

Seattle are facing economical crisis at the moment and several businesses, establishments and setups are facing very difficult times.
But According to this report Seattle is planing to raise its minimum wage to fight against this crisis.

But I don't completely concur to this strategy, the problem will be invincible if this is the approach they choose to follow, a big factor in any business closing up is the poor financial state to keep the business running increasing the minimum way that they businesses who are fighting financial battles can't meet won't solve the problem.

If this was a case of lack of interest in jobs or low manpower then an increase in minimum wage may solve that. It would be better to give out grants, low interest loans and support for local businesses.

Sometimes the government just wants to be proactive without actually solving any problem but they want to look active, sometimes ago this same policy was passed in my country after too many back and forth, they increased minimum wage and like nothing really changed for the masses, cause the cost of living also increased.
So if the cost of living is say $20 and it increases due to inflation to $60, if you now increase minimum wage from $30 to $50, I guarantee you it will help some persons but you see the masses, that will do nothing for them as they have to incur more than they have just to survive