One major legislative issue this year has been raising the minimum wage. Currently, the average minimum wage in the United States is roughly .25 per hour. President Obama, with little success, has made a push to raise the minimum wage to around .00 per hour, still not a livable wage, but any movement in the right direction should be considered progress with the absolutely dismal economy we are living in. Currently, there are 21 states and Washington D.C. that have a minimum wage higher than the national average, with Oregon and Washington leading the pack with minimum wages of .10 and .32 per hour, respectively. 20 states meet federal minimum wage requirements while 4 states somehow are below minimum wage and 5 states have no minimum wage required. Many may wonder how important a raise in the minimum wage really is. With the unemployment rate hovering at about 7 percent, though I suspect that number is extremely conservative, and over 50 million people living below the poverty line a significant increase in the minimum wage could help stimulate the economy back into some semblance of normalcy though even that is a long shot given the cost of living in today’s society. Simply put, a job paying minimum wage, such as one found at McDonald’s, Rite Aid, or any number of the large chains used to be an opportunity, a beginning, while today such a job is a tragedy. There is no denying that current minimum wage jobs are not sufficient for an adult living on their own and the proof is in the numbers. Let’s take a big city, New York for example. If a person lives in New York City they will make a minimum wage of .00 per hour grossing 0.00 per week based on a 40 hour work week and then taxes are taken out. If we are generous in our estimates we can say only .00 are taken in taxes. A one week unlimited Metrocard, which costs around .00 makes up 10% of this person’s paycheck. They are then left with 0 in which to pay rent, eat, pay utilities, etc. which seems highly unlikely in a city where the average rent tops 00.00 and even rents in surrounding areas such as Brooklyn and Long Island hover well over 00.00. These numbers make living in a large city such as New York, Los Angeles, or Chicago nearly impossible. Even in a smaller metropolitan area such as Oklahoma City where the average rent is 3.00 this only leaves about 0.00 per month for groceries, utilities, and some form of transportation to get to and from work. This leaves no money to save and saving is the cornerstone of opportunity. As wealth grows a person can invest in stock, land, their own business, and receive higher interest rates on savings but saving when all of your check is spent is an impossibility as the money just isn’t there. Many may believe this isn’t a problem that they need to concern themselves with as they have a college degree. The sad fact is that 40% of college graduates are unemployed upon graduation while 16% only hold part-time jobs. If a college graduate can no longer count themselves amongst those making a salary that places them amongst the almost non-existent middle class then what are the chances for a person without a degree or with no trade? States and localities may feel the need to take action in issues of minimum wage but how much good will it really do? Even if the minimum wage were to increase to .00 per hour it is still not livable in a major metropolitan area. Even if a person in a smaller market is able to survive, they won’t be able to save and we haven’t even mentioned the fact that very few of these minimum wage positions offer any type of healthcare coverage so insurance is another major expense and for a person in this position it is likely a financially crippling one. Truth be told, raising the minimum wage is the tip of the iceberg and until people are in a position where they have opportunities to grow financially the economy will stay stagnant and the unemployment rate will continue to slowly rise leaving a good percentage of the population to live below the poverty line. If legislators want to make a real difference they should hire more for positions within government and loosen the eligibility requirements on SBA loans. Whatever it is that is done it needs to happen quickly and with the working man in mind.
Article By: Jon DaBove
