The negative correlation in increasing minimum wage

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Posted: 7/2/09

As of July 24, the federal minimum wage will make a 70 cents increase, jumping from $6.55 to $7.25.

Many see this increase and it puts a smile on their faces, but soon after that instant gratification does not often last too long.

There are two main arguments about minimum wage: there are those who believe that increases in minimum wage are the results of higher costs of living. There are also those who believe the increasing costs are the result of the raises in minimum wage pay.

Whichever you believe, when you see one of these things happen, you can expect it to be accompanied by the other.

Along with each argument, come other issues, too. With an increase in the minimum wage, companies try to make up the difference by taking other steps, such as cutting the number of paid holidays allowed.

Another issue that comes up when minimum wage is raised is the disturbance that it may create among older employees.

Because employees that have been with a company for several years are on older minimum wage pay schedules, a newer employee, like a 16-year-old who has just become eligible to enter the workforce, will earn more than a long-time employee who has served several years at a minimum wage paying job.

That issue puts some companies in a tight spot, as they then have to deal with unhappy employees who have experience under the job.

And these employees have reason to be upset. Not many people with experience in a field would appreciate having a new, unproven employee coming in and earning more money than when they started.

Also, along with a minimum wage increase comes hesitation from the employers to hire more people, which, of course, mean less job opportunities for those who are looking, especially with the state of the economy right now. That explains why some students are not hearing back from many of the businesses that they turned in applications to as the spring semester came to an end.

There may be lots of students who, looking forward to the increase in minimum wage, thought "sweet," "awesome," or "(enter joyous phrase here)," but were soon facing the reality that while the wage may have increased, the opportunities, with many businesses, have decreased, and that joyous thought was soon replaced by questions and expletives.

The editorial is the majority opinion of The DEN editorial board. Reach the opinions editor at: DENopinions@gmail.com.