Why Is Minimum Wage Important?
Quick Answer
The minimum wage is important because it raises wages and reduces poverty. Proponents assert that it is needed to protect workers from exploitative employment practices. Opponents of the minimum wage claim that it is an unnecessary government intrusion into the relationship between employer and employee.
Continue Reading
Full Answer
The precursor to the minimum wage was passed by King James I of England in 1604. The Act Fixing a Minimum Wage established a minimum wage for textile workers. Prior to passage of the Act, there was an established maximum wage but no formal minimum.
The federal minimum wage was established by the Fair Labor Standards Act of 1938. The wage was set artificially high to render low-wage factory jobs in the South obsolete. Subsequent amendments to the Act increased its scope to cover retail and other sectors of the economy and to mitigate unintended consequence to Puerto Rico, the U.S. Virgin Islands and other territories.
As of 2014, the federal minimum wage is $7.25 per hour, but there is pressure on Congress to increase it to more than $10 per hour. Advocates for increasing the minimum wage assert that an increase is necessary to improve the wages of a large number of working women and because, after adjusting for inflation, the minimum wage for tipped employees is at its lowest level since 1966.
Learn more about EconomicsRelated Questions
-
Q:
What Is a Third-World Country?
A: A third-world country is an underdeveloped nation with widespread poverty. Most third-world countries are located in Asia, Africa or Latin America. However... Full Answer >Filed Under: -
Q:
Why Are Some Countries Rich and Others Poor?
A: The wealth or poverty of nations depends primarily on intrinsic factors: geography, climate and availability or lack of resources. Having a geographic loca... Full Answer >Filed Under: -
Q:
What Is the Federal Poverty Line?
A: For 2015, the federal poverty guideline for a household of four people is $24,250 in the contiguous 48 states and the District of Columbia. A household of ... Full Answer >Filed Under: -
Q:
What Are the Financial Criteria for Living Under the Poverty Line?
A: As of 2015, the U.S. government classifies people with an income of less than $11,770 for a single person or $15,930 for a couple as living under the pover... Full Answer >Filed Under:
You May Also Like
-
Q:
How Can You Access Statistics on the U.S. Cost of Living?
-
Q:
Why Is Waste Management Important?
-
Q:
What Is Market Opportunity Analysis?
-
Q:
Who Publishes the Average Price of Heating Oil?
-
Q:
Where Can You Find Some General Questions and Answers Related to Microeconomics?
-
Q:
Why Is Porcelain Important?
