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    Organized protests by hundreds of fast food workers called for raising the federal minimum wage to $15 per hour from the current $7.25. During a Texas gubernatorial debate, one candidate supported raising the minimum wage to $10 while the other argued that most hourly wage jobs in Texas already pay above minimum wage. Economists note that raising wages could increase prices for goods and services if businesses raise prices to cover increased production costs, though the effects would be delayed and depend on the size of the wage increase. Different views exist on whether and how much to raise the minimum wage.

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    News Story 1

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    Organized protests by hundreds of fast food workers called for raising the federal minimum wage to $15 per hour from the current $7.25. During a Texas gubernatorial debate, one candidate supported raising the minimum wage to $10 while the other argued that most hourly wage jobs in Texas already pay above minimum wage. Economists note that raising wages could increase prices for goods and services if businesses raise prices to cover increased production costs, though the effects would be delayed and depend on the size of the wage increase. Different views exist on whether and how much to raise the minimum wage.

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    Organized protests by hundreds of fast food workers called for raising the federal minimum wage to $15 per hour from the current $7.25. During a Texas gubernatorial debate, one candidate supported raising the minimum wage to $10 while the other argued that most hourly wage jobs in Texas already pay above minimum wage. Economists note that raising wages could increase prices for goods and services if businesses raise prices to cover increased production costs, though the effects would be delayed and depend on the size of the wage increase. Different views exist on whether and how much to raise the minimum wage.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    59 views3 pages

    News Story 1

    Uploaded by

    api-317345673
    Organized protests by hundreds of fast food workers called for raising the federal minimum wage to $15 per hour from the current $7.25. During a Texas gubernatorial debate, one candidate supported raising the minimum wage to $10 while the other argued that most hourly wage jobs in Texas already pay above minimum wage. Economists note that raising wages could increase prices for goods and services if businesses raise prices to cover increased production costs, though the effects would be delayed and depend on the size of the wage increase. Different views exist on whether and how much to raise the minimum wage.

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    of 3

    Is There Cause for Concern If Minimum Wage Increases?

    by Ashley Sanchez
    Hundreds of U.S. fast food workers walked out in protests in over 150 cities nationwide
    on Thursday, September 4. Organized by the Service Employees International Union, the
    workers called for an increase of the federal minimum wage to $15 an hour.
    The minimum wage increase became a topic for discussion in the Texas Gubernatorial
    Debate as well on Friday, September 19. Senator Wendy Davis spoke in favor of the increase to
    $10, stating, Raising the minimum wage is not only good for Texas families, its good for our
    economy.
    Attorney General Greg Abbott, however, did not agree. He argued, Here is the lost fact,
    and that is about 94 percent of the hourly wage jobs in the state of Texas are paid at above
    minimum wage already.
    Hourly wage workers making minimum wage or less accounted for 6.4 percent of Texas
    hourly wage earners in 2013. That was, according to the federal Bureau of Labor Statistics, the
    fifth-highest percentage in the nation.
    The raise which SEIU members are asking for is a 107 percent pay increase from the
    current federal minimum wage of $7.25 an hour. This has raised concern that prices too may rise
    if such a pay increase were to pass on a federal or state level.
    According to Dr. Paul Stock, the Interim Dean of the Accounting, Economics, and
    Finance Department of the McLane College of Business at UMHB, for business owners the cost
    of production includes the wages which they must pay workers, so they base the prices off of the

    cost to produce. If the cost of wages goes up, the cost of production goes up, and then businesses
    are going to have to charge more for the goods and services they provide. There would be a
    delay before prices would increase if the wage was raised. The higher the increase, however, the
    greater the likelihood that prices would increase.
    So while employees may see some benefits in the short term, says Dr. Stock, in the
    long term, increasing prices could take a lot of that benefit away. It could erode the benefits that
    workers might otherwise see.
    If the federal minimum wage, which was last raised back in 2009, was adjusted for
    inflation over the past five years, 9.7 percent, wages would only need to increase to $7.95 or
    about $8 an hour.
    In Dr. Stocks opinion, this would be the ideal solution, if the minimum wage changed
    every year based on the inflation rate, because the inflation rate measures changes in prices, and
    thats really what youre taking about, how much it costs to live.
    The recent SEIU protests are not the first mention of increasing the federal minimum
    wage. A bill known as the Fair Minimum Wage Act of 2013 was introduced to the Senate early
    last year on March 5, 2013. The bill proposed would raise federal minimum wages to $10.10 an
    hour gradually over the course of three years, and then be adjusted annually based on the
    Consumer Price Index.
    In his State of the Union address earlier this year President Barack Obama again called
    on Congress to raise the wage to $10.10 an hour. One of the primary concerns in wanting to
    raise the wage, to bring 2 million people out of poverty, at least according to the Executive
    Offices A Year of Action: Progress Report on Raising the Minimum Wage.

    Thirteen states and the District of Columbia have already increased their minimum wage
    beyond that of the federal minimum. Whether or not federal or state minimum wage will
    increase in the near future and what that price might be are still up for debate. The effects that
    raising the wage could potentially have, however, make watching to see where this issue goes
    highly important.

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