Minimum Wage War Continues

NEW YORK (MainStreet) — On December 31, New York State will raise the minimum wage from $7.25 an hour to $8.00. This is the first of three increases that will happen over a span of three years capping the minimum wage out at $9.00 in 2015. Once this increase takes effect, New York will become one of at least 20 states (along with the District of Columbia) with a minimum wage higher than the federal rate. This raise in New York is part of a greater national debate. It is a conversation that hinges on what's best for American companies and the fact that the cost of living is on the rise in light of inflation.

According to the Bureau of Labor Statistics in 2012, there were 75.3 million workers in the United States age 16 and over paid at hourly rates, representing 59% of all wage and salary workers. Among those paid by the hour, 1.6 million earned exactly the prevailing federal minimum wage of $7.25 per hour. About 2 million had wages below the federal minimum. Together, these 3.6 million workers with wages at or below the federal minimum made up 4.7% of all hourly paid workers.

Currently, many people who earn the minimum wage are enrolled in government entitlement programs such as welfare, food stamps, and Medicaid. That can be exaggerated in metropolises with a high cost of living.

"HRA administers programs that provide over $30 billion in cash, food stamps and Medicaid benefits for low income New Yorkers," said Carmen Boon from the New York City Human Resources Administration. There are 1,850,432 New Yorkers people enrolled just in Supplemental Nutrition Assistance Program (SNAP).

Programs like SNAP are funded by taxpayers, who are bearing the burden of many of these employees as well as the unemployed. With these figures and facts, raising the minimum wage substantially seems logical. Phillip Wilson, president of the Labor Relations Institute, explained the root of the issue.