Argument: Higher wages boost economic growth

Employees work harder when they are paid more, but employers can often be more concerned with the short-term bottom line and will not treat workers in the lowest echelons of their firms with much consideration, viewing them instead as disposable and replaceable economic units. [1] Mandating a minimum wage can thus benefit firms, even if they do not recognize it, by making workers more productive and also fostering a general work ethic. [2] As workers feel more valued in the economic system, the more likely they are to work loyally and diligently for their employers. Furthermore, better pay means more disposable income in the hands of employees, which leads to greater demand by them for goods and services. This demand-induced economic growth is a very important part of economic growth. The more people are able to spend, the more money flows into the economy, leading to more business and higher employment. Without the minimum wage, a downward spiral of spending can ensue, proving deleterious to firms and the economy generally. Additionally, the minimum wage decreases expensive social welfare payments, since workers no longer need as many supplements to their wages from the state in order to make up for the shortfall created by too-low wages.

[1] Freeman, Minimum Wages – Again!, 1994

[2] Filion, EPI’s Minimum Wage Issue Guide, 2009

Candidate 1: "While it is of course socially desirable that everyone be able to find gainful employment and pursue happiness, this is not accomplished even remotely by the existence of a minimum wage. In fact, it denies more people the ability to pursue happiness because the minimum wage forces unemployment up as it becomes more expensive to hire workers. The choice to work should belong to the individual, whether his decisions have an effect on the wages of others or not. Individuals can only have control of their destinies when they are not limited in the range of their potential actions, which must include the right to sell their labor at whatever rate they find acceptable, be it at some arbitrary minimum or lower."
Candidate 2: "There is no social justice in denying people the ability to work. The minimum wage serves to benefit insiders who are employed and harm outsiders who do not have jobs and cannot get them due to the dearth of jobs created by the wage laws. [1] The state may have the best interests of its citizens at heart when it institutes a minimum wage, but it accomplishes little when it leaves more of its citizens without work, and thus dependent upon the state for survival.

[1] Dorn, Minimum Wage Socialism, 2010"
Candidate 3: "The incentive to enter the illicit market is actually higher when there is a minimum wage. While the relative advantage of entering the black market might be diminished for some who can enter the legitimate workforce and find employment, the higher numbers of people now unemployed would find it necessary either to seek welfare payments from the government or find alternative employment. Such employment could be readily found in the illegal market."
Candidate 4: "Employers are not stupid. Many do see the value of higher paid workers and appreciate their harder work and dedication. That is exactly why a minimum wage is unnecessary; firms in pursuit of their own self-interest will pay workers competitive wages. Furthermore, social welfare payments will not decrease with the advent of a minimum wage since while some workers will not require income supplements from the state, the higher numbers of unemployed workers will look to the state exclusively as their source of income, raising the cost to the state and the taxpayer."

Employers are not stupid. Many do see the value of higher paid workers and appreciate their harder work and dedication. That is exactly why a minimum wage is unnecessary; firms in pursuit of their own self-interest will pay workers competitive wages. Furthermore, social welfare payments will not decrease with the advent of a minimum wage since while some workers will not require income supplements from the state, the higher numbers of unemployed workers will look to the state exclusively as their source of income, raising the cost to the state and the taxpayer.
