The History and Effects of Minimum Wage, Essay Example

The term minimum wage refers to a regulated minimum amount of compensation implemented either by law or union agreement. While the minimum wage has recently been revisited, the concept had its origins many centuries ago. In order to understand the effects of the minimum wage and what it would mean to raise it, it is important to understand the reasons for initially implementing this concept, as well as its historical context. This topic has been one of heated discussion both amongst economic scholars and members of the workforce. The minimum wage debate is a controversial topic that can only be fully comprehended through study of its historical results and general purpose.

While the minimum wage debate has recently gained a plethora of attention in the United States, the concept had its roots in Europe. The idea of an enforced minimum acceptable amount of compensation stems back to England in the thirteenth century. In thirteenth century Europe, lowly workers were paid such meager wages that they could not reasonably survive or provide for families. The practice of not paying workers enough to survive on was called “sweating” (Nordlund). This motivation for implementing a minimum wage in Europe carried over to the United States when workers began to experience the similar strain of not being able to survive on the minimal payment they were receiving for their labor. In the beginning, wage regulations were primarily allotted to women, who would otherwise have been paid next to nothing for their work. These laws also limited child labor occasionally. It was not until 1938, however, with the passing of Fair Labor Standards Act (FLSA), that minimum wage requirements were also extended to men (Nordlund 1). The FLSA, under president Roosevelt, also set the minimum wage at 25 cents per hour. The rates have since been revised (“Minimum Wages and Employment: A Review…” 1).  While the minimum wage argument may seem to be somewhat of a current event, the rich history of its use to combat mistreatment of workers is essential to understanding how far reaching this topic truly is.

Minimum wage requirements are calculated taking into account numerous factors, however, the economical consequences of changing the rates are also troubling. The basic principle behind the idea of a minimum wage is that it should be enough for an individual to live off of and also use to help support his/her family. One of the main issues with this concept is whether this amount should be calculated taking into account only the individual’s necessary income for survival, or by looking at the incomes of all of the working family members. Inflation and an increased unemployment rate are both very real consequences that may stem from raising the amount employers are required to pay (“Revisiting the Minimum Wage-Employment Debate…”). Being that many different factors can alter the effects of revising the minimum wage, changes to these laws are thoroughly examined and debated before any changes are actually implemented.

The debate over the minimum wage is a topic that has recently gained attention, but has existed for centuries. While most members of the workforce appreciate the laws that protect them from being taken advantage of, others argue that the laws are outdated, and employers should be free to set their own wages. Even so, the minimum wage has existed for the purpose of protecting families and individuals by guaranteeing that they will be able to survive off of the amount they make. The minimum wage is a largely controlling economic force, and is therefore the topic of much discussion and revision.

Works Cited

Neumark, David, and William Wascher. “Minimum Wages and Employment: A Review of Evidence from the New Minimum Wage Research.” National Bureau of Economic Research (2006): n. pag. Web.

Neumark, David, J.m. Ian Salas, and William Wascher. “Revisiting the Minimum Wage-Employment Debate: Throwing Out the Baby with the Bathwater?” Sage Journals (2013): n. pag. Web.

Nordlund, Willis J. The Quest for a Living Wage: The History of the Federal Minimum Wage Program. Westport, CT: Greenwood, 1997. Print.