**This article is sourced from the Washington State Dept. of Labor and Industries**
The ongoing debate about minimum wage has intensified in recent years. As people advocate for a living wage to improve their standard of living, the price of everything else goes up right alongside the wage increase.
Washington State has long been renowned for its progressive policies and high minimum wage. Unfortunately, there are many pros and cons to higher minimum wages. Let’s delve into the good, the bad, and the ugly about how an increased minimum wage might affect you and your family.
The goal of increasing the minimum wage is to improve people’s living conditions. Higher wages ensure that people can afford the basic necessities such as food, rent, and other living expenses. The overall goal is to reduce poverty in the state of Washington.
The goal of improving people’s lives is a commendable goal. At first glance, an increase from $15.74 to $16.28 looks exciting and encouraging. Many people look at this and believe that they will be able to afford the basic necessities of life.
When lower-income employees earn more, they tend to spend more. It can give them a false sense of security. This helps to stimulate the economy. This, in turn, can lead to more jobs and more economic growth.
Employees who are earning more tend to be happier. This makes them more productive and offsets the cost of labor, as happier employees tend to be so much more productive.
Here’s the bad news. With a higher minimum wage, many businesses are going to be letting some of their employees go. They may shorten hours and spread the work out across the board. As the cost of labor goes up, many places of business may choose to cut back on hiring or reduce hours to compensate for the higher outlay of money.
Businesses may choose to increase prices as a way to meet the higher cost of earnings. This could potentially cause more inflation in the products that people purchase. Raising the cost of all products will gain them more revenue, which can be turned into wages for their employees.
Finally, we must consider how raising the minimum wage helps bridge the gap between low-income employees and their higher-earning counterparts. Does this change the equality of the two groups?
What about the impact on small businesses? How will they keep up the pace? Will they have to let people go and reduce hours to afford their employees? When smaller businesses have a smaller profit margin, they may have to face the fact of having fewer employees and doing more of the work themselves to offset the higher minimum wage.
The consequences may be more financial strain, reduced investments, or even smaller businesses closing. This could create a negative impact as people now have to go farther to reach specific businesses. This could also displace some employees and lower-skilled employees.
On paper, raising the minimum wage in Washington State looks great. However, it may also present a complex situation that has both positive and negative consequences. Looking at the good, the bad, and the ugly potential for the changes in labor costs and business revenue may not fully balance out the overall reasoning for increasing the minimum wage in Washington State.
How will it affect smaller businesses? How will it affect employees? Is there a delicate balance between employees who are in need of employees still requiring public assistance? Is there a way to sustain the smaller businesses and refrain from having to lay off or fire employees to be able to keep up with inflation?
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