THE IMPACT OF THE MINIMUM WAGE

THE IMPACT OF THE MINIMUM WAGE Since January 1993, the American economy has created 21 million new jobs. In the last four years, labor productivity has grown at a 2.9 percent annual rate and GDP has grown at a 4.4 percent annual rate. At the same time, the underlying core inflation rate in 1999 was 1.9 percent-the lowest rate since 1965. Recently, President Clinton and congressional Republicans are signaling a possible tax compromise that would help people pay for long-term health care, …

…pass on their higher labor costs. It is also difficult to determine potential costs to businesses due to the unpredictability of employer behaviour following an increase. Employer behaviour would vary depending on the size of the increase. However, for our company, which has a large concentration of minimum wage workers, the impact of increasing minimum wage will be negative, although not much, as long we are in the strong economy. REFERENCE ------------------------------------------------------------------------ **Bibliography** Jinjie Sun