Minimum Wage Increase
The pros and cons of the minimum wage increase.
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Depending in which state you live, workers in about 29 states will be getting paid more per hour. Yet, some states will not see any change in their hourly wage. The U.S. minimum wage goes to $7.25 per hour on July 24, 2009. The question is, will it help those earning low wages or do those workers risk losing their job.
Employers are required to pay the highest wage, so if a wage is $7.15, the employer would need to pay the higher wage of $7.25 minimum wage. There is an estimate of over two million workers who will get a higher hourly wage. The wage increase will put more money into the economy and can actually act as a stimulus.
Another effect would be if the wage increase is a hardship for employers who in turn would lay off employees. Some employers are already having difficulties due to the economy, a wage increase could cause them not to hire more workers. If this happens, the unemployment numbers would continue to increase which is not good.
The minimum wage for tipped workers has remained the same which is $2.13 an hour since 1991. Tipped workers generally have three times the poverty level of other workers and women are usually the ones affected the most. It has been suggested that the government extend the federal minimum wage to tipped workers as to any other wage earners.
The National Employment Law Project (NELP) concerning waiters, waitresses and other workers, say those who depend on tips should also receive a higher wage. Seven states already have the same federal minimum wage to tipped workers.
During 2008 over three million jobs were lost, we have done that again just in the beginning of 2009. Some unemployed workers took lower paying jobs just to have a job. The U.S. government gives a guideline of a set poverty level of $10,830 for one person or $22,050 for a family of four in the lower 48 states and D.C. Workers above this level may not be able to get Welfare related assistance.
Higher wages help workers be more productive and they like to keep their jobs. Higher wages can help reduce worker turnovers and reduce dependence on government assistance. Hopefully those who are lucky enough to have a job and get more money from the raise, will either save more or use the extra to paydown debts.
Until the economy improves further, higher wages will not help those who can't find a job now. Not having a job means not having money to pay debts. Some consumers are so stressed about being in debt it leads to health problems, sleeplessness, or unhealthy coping behaviors.
The best solution for those in debt without jobs is to tackle their debt issues as quickly as possible. Unless debt problems are faced, many could find themselves deeper in debt, at risk of loosing a home, an auto, or other things. There are some ways to handle not having a job or money for debts. It can be as simple as talking with creditors about delaying payments or getting involved with a debt counselor.
There are online debt counselors or debt professionals who can give free advice or options for debt management during trying times. There is also free online software to track bill payments or free online calculators and budget tools. Pursue your problems and take control.
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