Public Policy of the Minimum Wage
Public Policy on minimum wage in the United States has shifted focus in recent years. Many in the public and in the White House have sought to raise the national minimum wage to $15 per hour. This is what many find to be a decent living wage that may help those in poverty or near poverty. The past has seen introduction of the minimum wage in the United States beginning around the Great Depression. Then, the standard minimum wage was 25 cents. In order to match the value of those 25 cents, today's minimum wage would have to be $10.
Progress has been made in the last two years with regards to increasing the minimum wage. Some states like California have already adopted legislation to gradually increase the minimum wage to $15 in the upcoming years. New York City and Seattle are not far behind. Still, enough has been done to secure the goal of increasing minimum wage, affecting millions of impoverished Americans.
By examining efficiency wage theory and delving into qualitative research, this paper hopes to provide clarity on the origins of the movement towards higher national minimum wage and what efforts are being done at the local and state levels to improve minimum wages. This qualitative study will examine research articles and literature from the last 4 years to see if sufficient changes have been made to deliver the promise of higher minimum wages and the impact higher minimum wages have already had on countries that have adopted them. Lastly, the paper will include an example of an organization making efforts towards changing public policy for minimum wage. This section will allow the examination and interpretation themes, questions, and observations, that may be added in the study. Minimum wage efforts are everywhere and some organizations like raisetheminimumwage.com have made significant progress.
Introduction
The origins of the United States first national minimum wage came from the minimum wage law. The minimum wage law "was created as part of the Fair Labor Standards Act of 1938, a legislative measure intended to curtail 'labor conditions detrimental to the maintenance of the minimum standard of living necessary for health, efficiency and general well-being of workers" (p. 134).[footnoteRef:1] The act came towards the end of the Great Depression (1929-1939). Meant to provide a living standard for Americans through a set minimum pay for all American workers, the minimum wage law provided a guaranteed hourly pay for all legal jobs. As Royce details, the minimum wage law is not indexed based on inflation. Furthermore, the only way to increase the minimum wage is through approval by the Congress and state and local representatives. [1: Edward Cary Royce, Poverty and Power: The Problem of Structural Inequality (2015), p. 134.]
The minimum wage established a floor of hourly earnings. It is not indexed to the rate of inflation, however, so its real value declines over time as the cost of living increases. Whether the minimum wage is raised, how often, and by how much is a matter decided by Congress and state and local representatives" (p. 134).[footnoteRef:2] [2: Royce, Poverty, 134.]
This explains why the minimum wage in the United States has taken so long to increase. Because there is so much resistance from various forces concerning the national minimum wage, any progress made has been slow. If the United States is to adopt a higher minimum wage, it may prove beneficial to the poor of the United States more than several ways. One of which is health, specifically as it relates to healthcare and infant mortality. A recent study analyzed the effects a higher national minimum wage had on infant mortality.
Across all models, a dollar increase in the minimum wage above the federal level was associated with a 1% to 2% decrease in low birth weight births and a 4% decrease in postneonatal mortality. If all states in 2014 had increased their minimum wages by 1 dollar, there would likely have been 2790 fewer low birth weight births and 518 fewer postneonatal deaths for the year (p. 1514).[footnoteRef:3] [3: Kelli A. Komro et al., "The Effect of an Increased Minimum Wage on Infant Mortality and Birth Weight," American Journal of Public Health 106, no. 8 (2016): 514, doi:10.2105/ajph.2016.303268]
Aside from increasing the health of newborns, a higher minimum wage can also improve poverty markers for the most affected population, single mothers. Since 2009, the federal minimum wage has not increased. If it does, it may lessen "earnings poverty for single mothers, who are disproportionately represented among minimum wage workers. The Congressional Budget Office (2014) estimated that...
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