On Nov. 3, 2020 Florida voters passed a law set to raise the minimum wage to $15 per hour incrementally by 2026. Florida Amendment Two, otherwise known as the $15 Minimum Wage Initiative needed a 60 percent supermajority to be approved, just barely reaching that majority at a 60.82 percent of voters voting in favor of its implementation. Its passage has raised many questions regarding the merits and disadvantages of increasing the minimum wage, even if just on a state level.
The federal minimum wage is currently set at $7.25 per hour and has not been changed since 2009, over a decade ago. Despite no increases to the federal minimum wage, most states have minimum wage laws of their own that pay above, and occasionally below, the federal minimum wage, depending on their respective economies.
Opponents to raising the federal minimum wage argue that increasing it can lead to many layoffs, fewer hours for employees and price increases for consumers as businesses accommodate to a raise in wages. Notably, opponents assert that minimum wage jobs are meant to be temporary, entry-level jobs that are, simply, a way to earn extra money and are not meant to be one’s sole source of income. Additionally, they express that local business owners would be extremely hurt by federal minimum wage increases.
However, supporters argue the opposite—claiming that increased wages give minimum wage workers more purchasing power which they will reinvest into the economy, lift many Americans out of poverty and can lead to worker productivity, allowing businesses to prosper.
An article published by Harvard Business Review regarding Amazon’s minimum wage hike to $15 cited several studies that found wage hikes as an asset to businesses. Noting that higher wages attract more skilled workers, help keep workers at a company long-term and encourage employees to “work harder,” even if they don’t necessarily have to.
Furthermore, business owners even seem to agree that raising the minimum wage could be beneficial. In a survey of 1,000 business executives run by the Republican pollster Frank Luntz, 80 percent supported raising the minimum wage in their respective states. Additionally, the American Sustainable Business Council held a poll that found that 61 percent of small business owners support increasing the federal minimum wage to $10.10 gradually, with annual adjustments to the cost of living.
It’s important to acknowledge that both sides of the argument are accurate, however, oftentimes supporters and opponents are arguing at different circumstances. When opponents argue against increasing the federal minimum wage, they are typically arguing against an increase to $15 per hour, which in most states in the U.S. has the potential to cause massive unemployment and increased costs, as they have said. When supporters argue for increasing the minimum wage, they are typically rallying for a more manageable increase, say to $10 or $12 an hour, which does have the potential to improve local economies and raise minimum wage workers out of poverty.
With this in mind, a focus on the minimum wage on a state level could be a better alternative to a general increase in the minimum wage. In this way, legislators could change minimum wage laws to accommodate to the needs of their respective states. A state with more urban areas and, thus, a higher cost of living can justify a larger increase in their minimum wage, while, rural states could not justify such increases, since there are less costs associated with living there.
Tatiana Gonzalez // News Editor