Minimum Wages Essay Example | Topics and Well Written Essays - 500 words

Minimum Wages - Essay Example With both the Democrats and the Republican united on the issue of increase in the minimum wage a price hike is predicted in the near future. The current price of minimum wage is likely to rise from $5.15 to $ 6.15 in a phased manner spread over a period of 2 to 3 years. There has always been a clash of interest among organized labor groups and the business community. Organized labor group call for more competitive hike in minimum wage so that the workers enjoy a marked advancement in their standard of living. The business community is apprehensive of the economic consequences of rising minimum wage. Small business fears they would face a crunch forcing them to shut down their business or discourage new entrepreneurs due the rising cost of labor. Most small business organizations are in short of finance and hence if the cost of hiring labor is more then the profit generated then the costs are cut and expenses covered by making less recruitment. The business community at large predicts that the increases in cost of minimum wage would force them to lay off people and discourage them from making new recruitments thus increasing the rate of unemployment especially of the unskilled labors.