Locals debate the increase of minimum wage

By Rachel Hankinson — During the State of the Union on Feb. 12 President Barack Obama mentions raising the minimum wage salary. While discussing Americans’ wage that work full time but are only making minimum wage he noted that those citizens will only make $14,500 a year.

“Let’s declare that in the wealthiest nation on earth no one who works full time should have to live in poverty and raise the minimum wage to $9 an hour,” Obama said.

The concept of minimum wage was from President Franklin Roosevelt, who proposed it to help stimulate the economy during the Great Depression. He enacted the Fair Labor Standard Act in 1938 that made minimum wage 25 cents an hour. He argued that establishing minimum wage would get workers out of poverty and give consumers more to spend.

Since then, the minimum wage has sprung up to $7.25 an hour, not including the tax on wages. This would come to $15,080 a year for a full-time worker.

To raise the minimum wage each year is called indexing, which only Congress has the power to do at the federal level. States like Arizona and Ohio have indexed their own minimum wages to ensure that those living off minimum wage can afford to live. It is argued that by increasing the minimum wage than standard living increases as well.

“Let’s tie the minimum wage to the cost of living so it can finally be a wage you can live on,” Obama said.
Another argument Obama made was that when people have more money to spend they are willing to spend more on goods. This is known as the multiplier effect, a fiscal strategy that says that when consumers have more money to spend they will do so, giving businesses more profit and creating more jobs.

“I would save my money,” senior Michael Depietro said. “I’m very conservative. If wages are rising then so are the prices of everything else. I’d save my money for college.”

While many clapped for Obama when he proposed the boost in minimum wages many were less than excited towards the idea.

“We would have to start people out at a higher wage which would increase our pay roll and decrease our profit,” owner of Carnes Office Supplies Phil Carnes said. “I don’t mind paying people more but they have to work for a while and learn the job to get raises.”

Obama mentions that CEOs are making more money than ever and this sort of economic move would mostly hurt small businesses because they would be required to pay their workers more while they are spending more on raw materials.

“Those businesses with a larger work force would certainly be affected and would have to cut employees,” Carnes said. “There are a lot of companies who can’t afford to pay their workers at minimum wage and others are just greedy and don’t want to.”

“It’s going to cause everyone’s pay to go up,” community member Michelle Wilson said. “In theory it sounds like a good thing but it will only hurt the economy and small businesses. Working at a job that requires more skill than a minimum wage job, I should make more money than those making $9 an hour. If minimum wage went up I’d consider quitting and working at McDonald’s.”

Those who are part-time workers would benefit from the raise of minimum wage because it is shorter work for more pay and they are typically only paid minimum wage. Just the retail and wholesale sector alone has cut a million full-time jobs since 2006 and added over 500,000 part-time jobs. About 22,460 Americans hold a part time job.

“Minimum wage should be extra money,” senior Sami Dunkle said. “You shouldn’t be able to live off of minimum wage, not that you could with $9 an hour.”

Minimum wage does not necessarily apply to everyone. Those such as waitresses, who regularly earn tips do not get paid the minimum. Under the federal minimum wage law, employers are not required to pay these people at minimum wage rate. Each state has a different rate at which they pay these tipped workers, Ohio’s being $3.50 an hour at $255,000 a year.

“I’m trying to save up for college but it is hard because I only make $80 to $100 every paycheck which usually goes to gas,” senior Lyndsey DeMeo said. DeMeo works as a waitress at Milk and Honey.

Employers are supposed to make up the difference in payment if these tipped workers do not make the minimum wage standard in their tips. However tips fluctuate from customer to customer.

“During the summer tips make up for it but during the winter we are really slow and I make below minimum wage,” DeMeo said.

Thus far raising the minimum wage has only been supported by Obama. Whether or not it will be decided by Congress.

[Updated Aug. 7, 2017: This article has been reformatted for consistency.]