Quick Answer: What Will Happen If Minimum Wage Is Increased?

What are the negative effects of raising minimum wage?

Opponents of raising the minimum wage believe that higher wages could have several negative repercussions: leading to inflation, making companies less competitive, and resulting in job losses..

What would happen if minimum wage was raised to $15?

Raising the federal minimum wage to $15 an hour over time would boost paychecks and reduce poverty. A recent study from the Congressional Budget Office found that a minimum-wage increase to $15 by 2025 would increase paychecks for roughly 27 million American workers and lift 1.3 million out of poverty.

Will prices go up if minimum wage increases?

New research shows that the pass-through effect on prices is fleeting and much smaller than previously thought. … They also observe that small minimum wage increases do not lead to higher prices and may actually reduce prices.

What are two possible negative effects of an increase in the minimum wage?

Other Effects of Minimum WagesIncreasing the likelihood and duration of unemployment for low-wage workers, particularly during economic downturns;Encouraging employers to cut worker training;Increasing job turnover;Discouraging part-time work and reducing school attendance;More items…•