The Advantages and Disadvantages of Minimum Wage Essay Example

person’s child/children. Working part of full time can set a great example to children. Giving them a work ethic for when they are old enough to enter the workplace. It is very easy to get stuck on benefits; the motivation to go out to work isn’t always there. If the government are willing to give out Job Seekers Allowance to people, why would people want to work unless employers are offering more than Job Seekers Allowance is. It is easy to see why people get trapped in poverty, either on low pay or out of work altogether.

After all, why on earth would you work harder for just 8p an hour? Why go to the bother of doing overtime, pursuing promotion for a small pay rise, or even accepting such a low-paid job in the first place? - A real escape from the poverty trap - A minimum wage might well enrich the state, but it could also fund a better benefits system, writes Yvette Cooper, Independent on Sunday, The (London, England) - Sunday, March 16, 1997. Author: Yvette Cooper. A disadvantage to minimum wage is the fact that it is the same rate all over the country. It is £6. 08 for anyone, whether you live in Bradford, or London, or Manchester.

Living costs in cities like this are much higher than towns and villages in the country. If anything, people may argue that the minimum wage should vary depending on where a person lives. Living costs can vary, so why shouldn’t the amount that the people in these regions vary too? “The case for varying the minimum wage by region is much

weaker as regional wage differentials are not that large in the UK. The graph shows average wages by region for workers who left school by the age of 16.

Wages are noticeably higher in London and the South-East and lower in Northern Ireland, but otherwise there is little variation. So the only possible case for regional variation is a higher rate for London, but this is administratively difficult as one cannot draw a line around London inside of which wages are high and outside of which they are low. So, expect to see a single National Minimum Wage. ” - Economics: If it's good enough for everyone else, it's good enough for us - Labour has promised a minimum wage , but how high should it be and should it vary ?

Alan Manning weighs up the arguments, Independent on Sunday, The (London, England) - Sunday, May 11, 1997 Author: Alan Manning A more obvious positive to the minimum wage is such benefits as being able to pay for things, buy people and yourself things and not feel as restricted when it comes to life’s bills and outgoings. However, some may argue that a minimum wage can have an opposite effect on our economy. If everyone is earning a basic amount, the cost of things and even the cost of living will grow. Therefore buying ability will reduce.

More experienced employees will benefit from the minimum wage as it will allow them to retain their jobs, rather than competing with less experienced and qualified workers or younger applicants who might be willing to do the same job but at a lower rate

of hourly pay. At least with a minimum wage, employers are only allowed to drop their pay rates so low, so the more eligible employees will not lose their jobs to other people because they will happily do the job for cheaper. A negative factor concerning employees and the minimum wage is that some employees might feel that employers are getting away with paying them less than they deserve.

If there is a minimum amount for which a company has to pay its employers, then surely an employee doing a slightly more difficult job role might not feel as valued as they’d like to. Another disadvantage with the minimum wage for employees is the age bands. Anyone over the age of 21 is entitled to £6. 08 an hour. But who decided this? A 16 year old school leaver could have just the same outgoings as a 21 year old or a 48 year old employee. These people could even be doing a similar job in the workplace. The case for the minimum wage is not only that it's fair , but that it makes for a more efficient economy, based on high skills rather than poverty pay.

There are many who turn a blind eye to the facts of exploitation I have described, and there are others who simply don't know. - The wages of shame - 50p an hour for waitress, hairdreser on just 88p, Daily Record, The (Glasgow, Scotland) - Thursday, September 22, 1994. Author: Gordon Brown Some people may argue that job roles that require more responsibility should be entitled to more pay. If you were to compare a cleaner

to a childcare assistant, some companies might pay these employees the same hourly rate of pay.

Some might say this is fair, as they are both just doing a job, but childcare is obviously a job that requires more responsibility and qualifications. “But such a minimum will create problems, according to business people. Peters says young and unskilled people who cannot match the output of others may have to be excluded or have a different minimum . He says: "There is concern that a minimum wage should not apply or should be lower for such people because they are not worth as much as trained employees. "”. - Fears grow over minimum wage - Small Business.

Sunday Times, The (London, England) - Sunday, May 25, 1997, Author: Claire Oldfield Another drawback of a minimum wage is the competition side of things. While someone may be more than qualified for a job, the large number of applicants that a job advertisement might receive might be higher if they are offering the minimum wage to the successful applicant. This can be a bad thing for both the employee and the employer, as they might not get the chance to interview the person with the most suited application and experience if there are too many people wanting the job.

A negative factor about the minimum wage concerning the employers is that sometimes, they would argue that they can’t afford to pay people in our country to manufacture the goods we need. Labour in developing countries is much, much cheaper than in the UK. This means that our minimum wage cannot compete with such countries as

China and Thailand. It might be cheaper for a company in the UK to pay for labour in countries like these to manufacture the goods they want, and it will still be cheaper after they’ve paid for the materials, for it to be made and for it to be imported back to us.

This can allow companies in the UK to sell goods cheaper, therefore selling more of them to a wider market. Another factor that might be thought of as a negative regarding the employers is they are being made to share more of the money they have made from profits etc, with the people who helped them to make it, the employees. When it comes to views on increasing the minimum wage there are many different views about it. A disadvantage of increasing the minimum wage from ? 6. 08 to more than this could have a major effect on the level of employment in the UK.

If employers have to their workers more than in previous years they might not be able to afford to employ as many people, or they may even have to lay off workers, making people unemployed. This could therefore lead to a higher level of unemployment throughout the country. It could also increase the amount of competition for jobs. Some may argue that this could benefit companies, as the applicants will try to prove they are the most qualified and suited to the job position. Therefore benefiting the employer and company in the long run.