Toddsterpatriot
Diamond Member
What would happen if we cut minimum wage in half? Would employers hire twice as many workers?ToddsterPatriot, you're correct. If we eliminated the federal minimum wage rate, more people would be employed; but at wage rates that will be of drastically reduced purchasing power.
The lowest wages will eventually race to the bottom, and the median wage will also be reduced. The purchasing powers of the lowest third of USA's wage earners pay will propritonally be the greatest reduced.
The federal minimum wage rate to some extent bolsters all wages, but it doesn't affect all pay scales equally. It's of the greatest benefit to earners of the lowest wage rates, and of lesser benefit to employees earning higher wage rates. (If there's no scarcity of available labor), the extent of the minimum rate's effect is approximately proportional to the differences between the minimum and the jobs' rates, and it's an inverse relationship.
Elimination of the federal minimum wage rate would increase poverty and be of net economic detriment to our nation.
Respectfully, Supposn
If they have one worker who sweeps floors, would they hire two workers to sweep floors?
My guess is they will keep just one floor sweeper and pocket the extra money
What would happen if we cut minimum wage in half? Would employers hire twice as many workers?
No. But some workers who aren't worth $7.25 might get hired at $6.