Over the recent past, there has been numerous debate over a push by the federal to raise the minimum wage to $10.10 an hour from the current $7.25 (Epstein 2014). The article The minimum wage is no friend of the poor authored by Gene Epstein in the Barron’s is a well detailed analysis of how raising the minimum wage will consequently interfere with the labour market and ultimately influence international business. Epstein claims that there are many other better ways of lifting up people’s fortunes other than trying to micromanage the labour market.
According to the Congressional Budget office study, it was estimated that, if the minimum wage were raised, the total employment would be reduced by more than 500,000 workers. The CBO’s report has been seen to make a lot of Sense. Instead of people decreeing about how the unskilled labour pool cannot accept certain low wages offers, thereby condemning them to the joblessness status, they should be allowed to consider all other options apart from the use of direct means. Nonetheless, in the same article, renowned Nobel Laureate Economist Joseph Stiglitz is a big advocate for the minimum wage to be raised and has also critic the CBO report. Stiglitz argues that, the people should desist from using the issue of minimum wage as the principle approach to dealing with the issue of poverty. He further adds that, since the minimum-wage workers are not poor, it would another tactic where the government is trying to solve a problem using a blunt instrument.
The issue of on-the –job training becomes apparent in the whole article. This is considered to being one of the most suitable approach to dealing with the issue about people gaining more skills for a better pay. In addition, the notion of abolition of minimum wage is considered to likely cause rampant exploitation. Changes in the minimum wage are bound to affect the international business since labour is a vital ingredient in both the local and global business setting.
Works Cited
Epstein, Gene, Barron’s. The minimum wage is no friend of the poor. Web. Feb 22, 2014
