The debate of whether or not the minimum wage should be raised or not has been going on since the last time it was raised in July 2009 and even year before then. The debate touches on the subject that if raised it would prove nothing but benefits for the economy and for the citizens of the nation, however this has only been speculation. Arguments can be made for both sides but when looking at statistics throughout the years since the last increase of minimum wage, there are far more arguments that can be made for the increase to not happen. 

When making the debate for minimum wage being increased multiple make the argument that it would help improve the economy as people will take jobs that are higher paying and that it would reduce poverty as well as reduce the amount of people who are on unemployment checks. However studies have shown in multiple studies and through multiple outlets that although it would reduce those on unemployment and reduce poverty, it doesn’t equal out to the number of people who will lose their jobs. As well as the smaller businesses that will be heavily affected by the higher margin, especially as those businesses have just begun to steadily recover from Covid-19. A clear example of businesses being affected by this is in the case of Dawn Drouillard, Co-Owner of Fabulous Catering in Minneapolis, United States where she explained to United States of Care in an interview that her business was negatively and heavily affected by Covid-19. “COVID-19 and the resulting health crisis have affected me and my business partner on so many levels that ultimately it’s causing us to consider closing the business we’ve had for 21 years.”… “ We have been a thriving business and 2020 was going to be our most profitable year yet. Instead, because of COVID-19, we’ve had to let everyone go. It is difficult to know that our employees are losing their jobs as well as their health coverage because we no longer have the funds to cover it.” (Drouillard 1). Dawn Drouillard is a clear example of what Covid-19 has done to smaller businesses and the way that they have seen very little profit and sales during the pandemic. Although restrictions for businesses have been lifted it would not equate to the little profits that businesses had to deal with during the last year and a half. Raising the minimum wage would have just added insult to injury as the owners were already considering the idea of shutting down their more than two decades long business. 

Although this may only be one case presented and some might see it as not a major factor because it’s a small business, small businesses have a major effect on the economy and are a large part of it. A press release by the U.S Small Business Administration in 2019 displayed that small businesses are the lifeblood of the economy as they generated 44% of the US Economic Activity. They also hold ⅔ of new jobs and so getting rid of them is not an option and increasing minimum wages would cause a major effect as most owners stated that if raised then they would lay off many of their employees. 

Poverty is another huge problem for the United States and people believe that a way to combat this is by raising the minimum wage. However when talking about reducing poverty, the statistics show that increasing the minimum wage would only increase poverty status. As stated before if businesses were to have to raise their minimum wage then they would layoff their employees which would increase the unemployment and poverty rates. An article from 2019 by the Britannica explains the increase of unemployment surging if minimum wage was to be raised. “The Congressional Budget Office projected that a minimum wage increase from $7.25 to $10.10 would result in a loss of 500,000 jobs”… “ 54% said they would decrease hiring levels. ” Those who rely on working minimum wage jobs would now be laid off and the amount of businesses hiring would now be greatly reduced. Poverty levels would increase and so would unemployment levels causing a large impact on the economy. As much as people believe that raising the minimum wage would decrease the poverty rates, it statistically wouldn’t as businesses wouldn’t be able to continue to have as many employees and those laid off would have difficulty finding jobs.

In the end raising the minimum wage would harm the economy and society more than it would benefit it. Raising the wage would only result in higher prices, a lower employment rate, put smaller businesses at risk, and leave people both jobless and possibly homeless. As much as people believe smaller businesses don’t matter as much, they are a large part of the economy and without it the economy would plummet. Although raising the minimum wage would mean benefits for those who are willing to work, it doesn’t secure jobs for others before them or even after them which is something that is not viable as businesses are just recovering from a terrible year and a half of low sales from Covid-19 restrictions.