DOES RASING MINIMUM WAGEHELP WORKING POOR?

GROUP 1 presents

Definition

Minimum wage(n. ) is the lowest hourly, daily or monthlyremuneration that employers may legally pay to workers

Working poor (n. ) are unskilled workers

The relationshipBetween minimum wage and working poor

Increase cost for firm

Minimum wage will be raised

Business will have to promote the competition in market

Reduce cost in production

Cut down human source

The number of unemployment will increase

Example

Today in US the minimum wage is $7.5 per hours

President Obama called on Congress to raise the minimum wage to $9 per hour

Wells Fargo and Gallup ‘s survey:

28% of small-business owners said they would reduce their current workforce in response to a minimum wage increase to $9 per hour

A Duke University/CFO Magazine survey:

If the minimum wage raise to $10 per hoursCompanies would reduce jobs

• Raising minimum wage increasing of living for workers.

• Raising minimum wage motivates and encourages employee to work harder.

• Raising minimum wage decreases the cost of government social welfare program.

• Reducing distance between poor and rich people.

Supporting Ideas

• Unemployment• Raising minimum wage is inefficient way to

help working poor • Teenagers drop out of school• Prevent some unskilled workers from getting

the job training they need• Few minimum wage earners actually come

from poor households

Opposing Ideas

Unemployment

Unemployment

Inefficient way to help working poor

Cost of tranfering $1 to poor families (dollars) 0

1

2

3

4

5

6

7

8

7

1.7

Minimum wage EITC

Vast majority of minimum-wage workers do not live in poverty

Teenager and student under 25

49%Workers aged 25 and up51%

Proportion of employees working with minimum wage

• Exporting Labor• The government subsidizes the incomes of

low-wage workers• Supplement the fiscal stimulus with a

commitment • Earning income tax credit for the working poor

Solutions

Time to debate

• Bernatek, B. T., 2014. TRAINING AND DEVELOPMENT. [Online] Available at: http://www.referenceforbusiness.com/encyclopedia/Thir-Val/Training-and-Development.html [Accessed 31 May 2014].

• Coats, R. M., unknown. Minimum-wage increases and high school dropout rates. [Online] Available at: http://www.nicholls.edu/mcoats/newopeds/minimumwagedropouts.htm [Accessed 31 May 2014]. Lammam, C., 2013. Why Raising the Minimum Wage Won't Help Anyone. [Online] Available at: http://www.huffingtonpost.ca/charles-lammam/ontario-minimum-wage-hike_b_3836275.html [Accessed 31 May 2014].

• MANKIW, G., 2006. The Minimum Wage Debate. [Online] Available at: http://gregmankiw.blogspot.com/2006/04/minimum-wage-debate.html [Accessed 31 May 2014]. Sherk, J., 2006. Raising the Minimum Wage Hurts Vulnerable Workers' Job Prospects Without Reducing Poverty. [Online] Available at: http://www.heritage.org/research/reports/2006/07/raising-the-minimum-wage-hurts-vulnerable-workers-job-prospects-without-reducing-poverty [Accessed 31 May 2014].

• unknown, unknown. Disadvantages of Minimum wages. [Online] Available at: http://www.economicshelp.org/labour-markets/disadvantages-minimum-wages/ [Accessed 31 May 2014]. Wilson, M., 2012. The Negative Effects of Minimum Wage Laws. [Online] Available at: http://www.downsizinggovernment.org/labor/negative-effects-minimum-wage-laws [Accessed 31 May 2014].

• Eric Morath(2013) Minimum-Wage Increase Could Slow Future Hiring, Employment Survey Shows. [Internet] Available from: http://blogs.wsj.com/economics/2014/03/19/minimum-wage-increase-could-slow-future-hiring-employment-survey-shows/ Accessed: 29.5.2014

• Price controls.[Internet] available from: http://www2.yk.psu.edu/~dxl31/econ14/lecture8.html Accessed: 1.6.2014

References

Nguyễn Minh QuangNguyễn Trường AnhNguyễn Vũ Kim Trang

Ngô Thiện DũngPhạm Thị Linh TâmTrần Trung Kiên

Bùi Thị Thu Huyền

Thanks for your attention