The Minimum Wage Should NOT be Raised! Analysis From a Micro, and Macro Perspective.

The minimum wage is meant to be set so it sits just above, or on the line of poverty. This means that someone making the minimum wage will be able to meet their basic needs (and not much else) if they work 40 hours a week (American work week). Right now the minimum wage has not been adjusted for inflation, or the costs of living changes, and needs to be increased very slightly. This slight amount varies by state, so Trump's plan to vary it by state is far more logical than Clinton's.

First from a microeconomic standpoint.. The minimum wage sets a price floor on labor as shown in the graphic above. If a price floor is above the equilibrium for supply and demand then the market will not be able to correct itself. Naturally, if price of labor (min. wage) increases the supply (people wanting jobs) will increase, and the demand (hiring) will decrease. If the demand for labor is greater than supply we have unemployment. In Seattle the minimum wage is set to increase to $15 by 2017. Right now it is at $11 and we have already seen a 1.1% increase in unemployment in less than a year. That number is diluted because Seattle has a booming economy because of the technology market. It could have been as much as 2% if the market was in a normal state, or even higher if the economy was already on hard times.

From a macroeconomic standpoint... Increasing the minimum wage increases the costs of production for businesses. When the cost of production is increased the aggregate supply deceases, causing general prices (prices of all goods and services) to increase (better known as inflation), and the GDP to decrease. Increasing inflation reduces low income earners ability to afford basic goods and services thus INCREASING the poverty line and decreasing living standards for minimum wage workers. If the GDP growth decreases the US will not only have a harder time budgeting, but will also not be able to pay the dividends on the massive debt Obama has created, and the credit rating for america will continue to fall.