The paper "Minimum Wage: Influence on the United States’ Unemployment Rate" is a great example of a research paper on macro and microeconomics. A minimum wage is the minimum amount of compensation an employee must receive for performing labor. Minimum wage controlis established by contract or legislation by the government. At the beginning of the twentieth century, the minimum wage law is first formulated in New Zealand and Australian. At present, more than eighty percentage countries in this world use the establishment of the minimum wage law to provide the rights of the employee (Jackson, 2007). The unemployment rate is an aspect that affects any existing economy in the society.
It refers to the total population of the civilians who are not employed but are tirelessly looking for jobs. All eyes are watching the statistics of this (unemployment rate) because when it rises, it weakens the economy. A number of factors influence the rate of unemployment, but one key influence that is closely observed is the minimum wage rate. The minimum wage rate, therefore, refers to the lowest compensation (monthly, daily, or hourly) that employees are paid legally by their employers.
It can also be viewed from the perspective of the exchange of labor with the ‘ lowest wage’ an employer can offer. Variation in the minimum wage has a significant influence on both employment and unemployment rate. A higher rate of minimum wage reduces employment, other than raising the rate of unemployment. Some economists believe that employees are sacked from work when there is an increase in the minimum wage and others say that available employment opportunities might have phase-out. Activities undertaken by workers are then switched to machinery.
An example of this is the shoe shine stands which were once common in the streets replaced by a machine with a rotating brush shining people’ s shoes. Thus, some jobs are more profitable at a lower wage and less profitable at a higher wage. From the last year’ s October figures by The Bureau of Labor Statistics, the stock market increased because of the expected rise in interest rates. Interestingly, the employment numbers increased. In September of the same year, more than one hundred thousand people got jobs.
Would this be related to the variation in the minimum wage? What on earth effect of the minimum wage control system will be on the unemployment rate? What should the minimum wage standard be and how to set it?
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