minimum wage is an important economic indicator because it gives us an idea of the level of economic development that a country has, but it can also be used by clever politicians to further their careers and agendas. Minimum wage reflects the economic reality of a country. It must go hand in hand with the level of productivity that a country has. We can see two examples that reflect this economic pragmatism. There is a special case in St. Louis where the minimum salary was already $10 per hour, but it fell to $7.70. We can also see that Bruce Rauner, the Illinois Governor, blocked a new minimum wage that was going to be $15 per hour.
The minimum wage in St. Louis
There have been local governments led by Republicans that have blocked increases in the minimum payment. This has already happened in Cleveland and Birmingham, but in St. Louis the increase had already taken effect. It's estimated that about 35,000 workers will be affected by the reduction. Is this economic measure cruel or is it just pragmatism? Anyway, reducing the minimum income will be a little depressing. It's better to increase this gradually instead of increasing this drastically and then reduce it. The good side is that when the minimum wage is less, the employers have the capacity to hire more workers, thus, the unemployment rate falls.
Economic pragmatism in Illinois
The Governor of Illinois, Bruce Rauner, decided to block an increase in the minimum payment to $15 per hour. The Governor is completely sure that $15 is too much, so, it will hurt companies and increase unemployment. There is an example of this in the city of Seattle, where the unemployment rate is just 2.5 percent.
One of the reasons that unemployment is so low is because the company Amazon is creating a lot of jobs. Anyway, when Seattle increased its minimum income to $13 per hour, the less skilled workers lost a lot of hours. As a result, they were making $125 less each month. This study was made by the University of Washington.
What is the ideal minimum wage?
The ideal minimum payment should be around 50 percent of the median income. Illinois has a median wage that is $18.40 per hour, thus, a minimum of $15 is simply too high. It would be more than 80 percent of the median wage, so, the unemployment rate would grow exponentially. Economic pragmatism is the best for the United States, populism has never been good because it just produces poverty. The current Governor Of Illinois has chosen a realistic economic policy.
