The current minimum wage of $7.25 is not enough to live comfortably and should be raised.
In 2019, Congress passed the Raise the Wage Act, which would raise the federal minimum wage to at least $12, as well as eliminate the tipped minimum wage that restaurant workers experience. When the act was proposed, Congress cited the financial reports of families living off of minimum wage. On average, a parent of two children who is making the current minimum wage is thousands of dollars below the poverty line.
By raising the federal minimum wage to the $12 to $15 range, the National Education and Labor Committee estimated that at least 4.5 million Americans would be given the chance to escape poverty. This would mean that children could have access to better educational opportunities, neighborhood food stability would rise, and traditionally impoverished areas would be able to repair buildings and roads more often.
Raising the minimum wage would also allow businesses to flourish. If workers are making more money, this would facilitate the purchase of goods and services. More demand would lead to businesses needing more workers, which would begin a positive cycle in the economy.
Surveys conducted by both the Democratic and Republican parties indicate that approximately 75 percent of businesses support increasing the minimum wage due to worker productivity. It has been found that employees with a higher starting wage feel more motivated to succeed during the workday. Over half of the nation’s small businesses firmly believe that the federal minimum wage should be raised to at least $12.
The Economic Policy Institute (EPI), a nonprofit dedicated to raising awareness of the financial needs of lower/middle-class workers, raises the question of how an increased minimum wage would impact the hospitality and service industries. Currently, the wage of servers is significantly lower than the minimum wage. In the 1990s, Congress froze the subminimum wage for tipped workers at $2.13. This is because the wage takes into account the tips that restaurant workers receive.
The EPI found that in states where servers are paid the full minimum wage amount before receiving their tips, state poverty rates were significantly lower. Financial stability in workers’ households leads to better attendance and productivity. Increased demand once again begets increased hiring rates.
The EPI argues that an increase in the minimum wage would be a step toward ending negative racial stereotypes. Impoverished neighborhoods have historically been a way to keep Americans of color at a disadvantage. Because of this, the stereotype of people of color being portrayed as dirty, poor, or “beggars” has been “proven” in the eyes of those who do not rely on $7.25 to feed an entire family. By raising the wages, lower-income Americans would be able to afford better housing, more food, and access to reliable healthcare. This would allow Americans of color to be seen as equals, rather than someone beneath others based on income alone.
The federal minimum wage is outdated and does not reflect the complexity of today’s economy. By raising the minimum wage, the United States would be giving Americans the ability to prosper. Isn’t that what the American Dream is about?
Photo by Olivia Esselman
