Minimum Wage

Minimum Wage
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Labor laws are typically the result of government policies aimed at regulating labor practices. Recently, there has been debate on the impact of raising wages for both businesses and workers. Even though, the minimum wage is meant to help workers, the policies adopted do not always lead to the expected results, as the private sector typically creates most jobs and responds negatively to raising minimum wage levels. Those targeted by labor practices that seek to regulate minimum wages are at a disadvantage as employers look to cut costs through lower wage payment or hiring fewer workers. This paper aims to highlight on the negative effects of raising the minimum wage.
One of the mechanism through which employers respond to minimum wage increase level is by increasing the price of their goods. Thus, the disposable income of workers does not improve considerably, as this would be accompanied with an increase in the cost of living. Employer may result to selective hiring as well as reduce workers benefit to compensate for the rise in minimum wage (Wilson, 20...