Question

the consequences of a commonly used price floor— the minimum wage. The higher the minimum wage, the more unemployment it creates. Still , some of the workers who retain their minimum wage jobs can be said to be better off if their pay increases. Construct an argument supporting the minimum wage by citing the positives it brings

Answer 1

Higher value of a minimum wage is likely to reduce the extrimities of poverty whereby many people are out of poverty with a higher wage rate. It is true that not many people will get the already reduced number of jobs, but those who get will experience a higher standard of living. This is likely to help the overall economy as well.

As consumers these workers are likely to spend more which brings more money to the circular flow. The health status of families of these workers is likely to improve with higher wage rate. When wages are higher, workers who got the job feel more loyal to the employer which reduces the employee turnover. This is beneficial for the employers as they can reduce the cost of training and recruiting the staff. These are some benefits of having a minimum wage in the labour market.