That assumes that minimum wage laws do indeed result in an increased salary. Put another way, that assumes that if there was not a minimum wage of $7.25 (federal; may vary by state) then the salaries for some jobs would be lower than $7.25 (I used $3.62, a -50% cut, as a hypothetical example).
But do minimum wage laws indeed result in an increased salary? If so, in how many cases?
In this thread, several people have said that the going rate for low-end jobs in their area is already well above the minimum wage. The minimum wage wouldn't seem to matter in those cases.
I guess what I'm getting at it, the minimum wage may have lagged so far behind inflation that it may not really matter anymore, or may matter very little.
Quote:
Originally Posted by fintstone
Clearly minimum wage reduces overall employment as you must make enough additional revenue to cover the increased salary. If your customer base does not change, them you must increase prices. If he market will not allow for a price increase, you are out of business.
The $7.25 example dies not make sense because it us presented backwards. If $7.25 is the natural rate and you increase it to $14.50, can you raise prices enough to cover payroll or will you cut workforce? Would you hire additional employees at that higher rate and uf you did, how many would be entry level at that price? There are lots of things I am willing to pay somone to do for ne if the price is right. If it costs $20 to get my lawn mowed....I am in. If it costs $200 to get my lawn mowed...,I will either mow it myself or I will xeriscape.
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