Raising the minimum wage

Written by Walter Hecht   

The GOP contend that increasing the minimum wage will hurt employment. And logically that seems reasonable. If the price of a good or service increases, people with limited income will purchase less. However, historical data contradicts that assertion about the minimum wage. Hiring by business is influenced more by demand for their goods and services than it is by the cost of additional labor. If the minimum wage is increased significantly, low-income wage earners will have more money to spend, and they will spend it, increasing demand significantly. Business will be forced to hire to meet the demand. Increasing incomes of more wealthy people does not trickle down as much of their income is saved, here or abroad, and does not increase demand leading to more hiring.