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On January 1, 2016, the minimum wage increases will be in effect for the following states. What are the Consequences?

January 11, 2016 - 4:25 PM

It is a sad state of affairs.  It’s a damned if you do damned if you don’t situation.  There is no doubt the lower earning population must earn more money to survive.  It is another fact the small business owners are being slaughtered by government taxes. I assure you most small business saw this trend coming about 7 years ago and started plans to invest in technology over people.

Here’s some advice for the low wage workers: Instead of striking at the places where you are working, you might try voting for people who will lower taxes so companies can keep more of the money they earn and pass some of the profit on to you. With more money in everybody’s pocket, demand for goods and services will go up along with the number of jobs and wages.

Here’s some advice for business owners: In spite of paying more than minimum wage, how about incentivize the employee by providing education and an opportunity to share in the rewards of the company. Provide education. Even if it is a large company like McDonald’s. If you are unhappy with the language ability of your employee then provide some English classes. If you want better communication skills then provide communication classes.  Make them a better employee and what’s most important a better person.  Give them pride.  Certificates and recognition for learning. What if each employee was eligible for leadership training after six months.  With that comes a raise and more responsibility.  How about the ability to learn how they can own their own McDonald’s? Provide a dream.  Don’t assume your employee is not capable of learning.  Give them heart.

If the minimum wage is increased, business will drop off and layoffs will take place. Some of the people will lose their jobs. You can’t break the economic law of supply and demand without there being consequences. Demand will go down if costs go up. But there’s another consequence that these low-wage employees are not thinking about. As a business owner, if I have to pay someone double for the same amount and kind of work, then I’m going to find someone with better skills, reliability, and work ethic.

Unskilled workers will end up being displaced by more skilled workers. Take a look at youth unemployment. Low or no skilled workers are priced out of the market. Here is a list of states where wages will be increased.

CURRENT             JAN. 1            INCREASE

ALASKA                                               $8.75                     $9.75                 $1.00

ARKANSAS                                          $7.50                    $8.00                $0.50

CALIFORNIA                                       $9.00                   $10.00              $1.00

CONNECTICUT                                   $9.15                    $9.60                $0.45

HAWAII                                                 $7.75                    $8.50                $0.75

MARYLAND                                          $8.00                  $8.75                 $0.75

MASSACHUSETTS                              $9.00                  $10.00              $1.00

MICHIGAN                                            $8.15                   $8.50                $0.35

NEBRASKA                                            $8.00                  $9.00               $1.00

NEW YORK                                            $8.75                   $9.00               $0.25

RHODE ISLAND                                    $9.15                   $9.60               $0.45

VERMONT                                              $9.15                   $9.60              $0.45

WEST VIRGINIA                                    $8.00                 $8.75                $0.75

A few individual cities will be pushing for a wage adjustment of even more.

In Seattle, the wage will rise to between $10.50 and $13, depending on the size of the company, as the city moves toward a $15 minimum wage expected to be fully in 2021. In New York, fast-food workers and government employees will see their minimum wage jump to $10.50 in New York City and $9.75 in the rest of the state.

In July, the cities of Los Angeles and San Francisco will increase their minimum wages to $10.50 and $13 an hour as they seek to eventually raise the floor on wages to $15 an hour.

The federal government estimates that about 3 million workers are paid minimum wage around the country; we can expect hundreds of thousands or more to be affected by next year’s increase. Critics and supporters alike will be watching to see what happens to jobs and poverty.

-Audrey Cooper

Written by Emerald

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