The only worth-while argument against raising minimum wage is the claim it will “destroy jobs.” The argument is based on over-simplistic, but terrible, logic that if employers have to pay more for employees they will compensate by having less employees. Here is a just-the-right-amount of simplistic explanation of why that is bullshit.
1. Employers won’t fire people, they will quit.
Despite what Faux News addicts think, the majority of people working low-wage jobs are not lazy irresponsible deadbeats. In fact, many (if not most) minimum-wage workers have two or more jobs. [Reference: States where most people work two jobs] Many of those are parents who never see their children.
If minimum wage is raised, people won’t be losing jobs, they will be quitting. A living wage would allow people to… actually live! They may be able to go down to one full-time job and provide for themselves, and their families. How is this a bad thing?
2. More people will have more money, and more time to spend it.
When money “stalls” in a pool or demographic, we have economic slow-down. Right now, profits from successful businesses are largely “pooling” in the pockets of very few people. [Reference: Chart of US income distribution] Raising minimum wage will force businesses to distribute income among more people.
The power of capitalism is market demand, when a market cannot demand, then we have no power. A minimum wage hike will give more demand power back to a larger market. This means new businesses, products, and innovations can grow more freely.
3. The state with the highest minimum wage, has the most job growth.
4. Employers will have to “compete” for workers
Where there is a will, there is a way. One of the best parts of capitalism is competition, but we have forgotten competition needs to go both ways. If it is too cheap to pay workers, then it creates deflation by forcing people to settle for anything. Cheap labor, cheap goods, lower demand, all equal deflation. And many economists are saying that is becoming our biggest threat. [Reference: The Economist]
With minimum wage going up, and people being able to work one job where they were working two or three, employers will have to start trying harder to attract employees. Benefits will go up, pay will go up, and the value of people will go up. It’s simple supply and demand.
5. People want to work.
Scarcity creates scarcity, and abundance creates abundance. When we treat people as moochers and deadbeat, we create obstacles for them to educate themselves and improve their circumstances. Everyone wants a better life, but often feel it is too far out of their reach. If you give our citizens enough room to breath, they will flourish.
6. Minimum wage should compete with welfare.
The Right often complains that welfare is a disincentive to work. This is backward, welfare is not a disincentive to work, minimum wage is. Welfare programs are designed to help people survive, but minimum wage currently does not match living needs. If a full-time minimum wage job was BETTER than welfare, then less people would be on welfare.