Minimum Wage Increases and the Economy

EPI is a not-for-profit independent think tank that investigates economic trends and the impact of policies on US labor force. EPI's research will help decision makers, opinion leaders, supporters, journalists, and the general public to understand the bread and butter problems affecting the common Americans.

It is more important than ever to raise the minimum wage in the face of recession. Growth in minimum wage stimulates the economy by increasing consumption expenditure without increasing state or federal deficits. Consumer expenditure accounts for 70% of the economy, and an increase in demand is essential for the early launch of production and the creation of more employment. However, since 1966, wages and salaries have become the lowest percentage of national income, and since 1950 the profits of companies have become the largest share of national income. The Economic Policy Research Institute estimates that the Fair Minimum Wage Act of 2013 will generate revenues of more than $ 32 billion. New economic activities were transformed into 140,000 new full-time jobs.

It is good for our economy to raise the minimum wage. Increasing the minimum wage is necessary not only to increase worker income, but also to stimulate demand and promote economic development, but it reduces sales and reduces the cost of taxpayers' low-income employers Reduce the company to the highway. , High human capital model. Despite these positive gains, and unfortunately today's minimum wage is much lower than the latter half of the 1960s, the Senate is to raise the federal minimum wage from $ 7.25 per hour to $ 10.10 per hour You will vote for it. The same unfounded argument of going out means that the minimum wage will reduce employment. Today's unemployment rate is over 7%, so we expect these types of discussions to reach the level of fever.