Minimum Wage

Working For a Living 

Bus boy, bartender, ladies of the night

Grease monkey, ex-junky, winner of the fight 

Walking on the streets, it's really all the same

Selling souls, rock n' roll, any other day  

Workin' for a livin' (workin')

Workin' for a livin' (workin')

Workin' for a livin', livin' and workin' 

I'm taking what they giving 'cause I'm working for a livin' 

If you work for a living, then should there be a minimum wage? 

A minimum wage  benefits society, which includes both the worker and his employer.  Under unregulated capitalism, the minimum wage should be zero. ( Under unregulated capitalism, there  also should be no child labor laws or overtime laws, but that is another subject.).  If the minimum wage is zero, eventually workers would no longer be able to live and work.  Not only would the employer have no workers, but he probably would have no customers because he probably sells his products to workers of other firms.  An employer who pays zero for wages might profit today, but it is an unsustainable business model, and will fail in the future. 

If it is accepted that there should be a minimum wage, then what should be that minimum wage?  In 2007, the Federal minimum wage was established as $7.25 per hour.  However there has been inflation since that time.  The Federal Reserve Bank has a goal to keep inflation at less than 2% per year. 

That increase has not been the same on all products.  Since 2007, and especially during the COVID pandemic, inflation has been higher in some consumer categories. According to the Bureau of Labor Statistics, food prices increased by 4% last year, while other products such as energy declined by 7%. 

According to the Consumer Price Index, a wage of $7.25 in 2007 US Dollars, USD,  would be worth only $5.82 in 2021 USD.  Has this real decrease resulted in an increase in jobs?   Most probably, since that wage is closer to zero and thus the cost of labor has decreased for each employer.  But that is not a sustainable model for society, or for those businesses who benefit at the present time.  Increasing the minimum wage to at least the previously accepted value should be justified.  However, that is only if the prices of all products grew at the same rate.  Since the price of those products most likely to be purchased by minimum wage workers has increased at rate higher than inflation, then a higher minimum wage than $9 per hour appears to protect society, including both workers and their employers. Additionally that rate should be indexed to increase, if prices increase.