Research Paper on:
Minimum Wage Debate

Unformatted Sample Text from the Research Paper:
such an increase will eliminate or decrease the demand for employees in lower paying jobs: "Like the trade-off between employment and inflation once said to be inherent in the Phillips  curve, higher minimum wages are supposed to lead to fewer jobs" (Business Week, December 1999, p. 170) and that "Young or unskilled workers would be unable to find work at  the mandatory minimum" (The Economist, 2001, p. 10). Some analysts say this is not true, that "in a fast-growth, low-inflation economy, higher minimum wages raise income, not unemployment" (Business  Week, 1999, p. 170). Supporters of minimum wage increases point to the increases made in the 1996-1997 fiscal year when the standard was raised from $4.25 to $5.15 per hour  (Mooney, 2000). The increase established at that time raised wages of about 10 million employees. of these, about half worked full-time and nearly 75 percent of the recipients were adults.  Unemployment dropped from 5.4 percent in 1996 to 4.2 percent in 1999 (Business Week, 1999). These data would support the claim that unemployment does not increase as a result of  a raise in the minimum wage. In fact, increasing minimum wages can lead to a better education for adults who are affected by the increase and their children (Business Week,  1999). Traditional economic theory also suggests that higher minimum wages reduce employment among low-skilled people, therefore, such an act would increase welfare rolls. Business Week reported that a 50 cent  increase in minimum wage resulted in 2.5 percent of welfare recipients to get off welfare and go to work (Business Week, May 1999). The percentages would increase based on the  corresponding increases in minimum wages. In November 2000, Mooney reported a study by the National Low Income Housing Coalition. This study found that "federal minimum wage earners are unable to