re: The Problem With a Federal Minimum Wage

True most people working at $7.25 are the young workforce who are still supported by their parents for the majority of living expenses. If anything the $800 a month the youth make working on $7.25 helps reduce the parents monthly budget. For those who are older working on minimum wage they are most likely receiving government assistance in some way shape or form.

The $7.25 was never to provide a living wage for people. Ultimately the minimum wage debate is a tax grab by the feds who will receive more payroll taxes from employers when they go to pay the match on employees fica, and Medicare since they are paying a higher rate with a wage increase.

It’s easy to say pay a higher wage to people but there are numbers behind that. For a business who may start employees off at $7.25 that have 40 man hours per day then any increase is a substantial cost on their bottom line. A minimum wage to $10.25 an hour would burden a business with $45,000.00 a year in additional labor, plus roughly $5,000 in additional payroll tax. Which means a business would have no choice but to raise their prices to offset such a huge cost in labor.

Thus defeating any good a minimum wage hike would do because now those same employees will be paying more for products. It’s a cycle that needs to be realized. Because if you keep doing this every ten years based on cost of living then in 2050 we will be talking about a $40 minimum wage, with the average Big Mac costing you $15.00. See where I’m going with this?