Think of the minimum wage as the price of a basic economic input – entry-level labor – plus the social value of preventing unfettered competition for that input. If government is going to set that price, it ought to do so in a rational, consistent manner.
Of course government should step in and artificially distort prices of business inputs. But why stop there? If competition for inputs is bad, let's be consistent and set price floors for other inputs like steel, cement, lumber, computers, land, etc.
Minimum wage is a basic government-imposed price control. Price controls set a floor indicating what minimum price must be paid for certain good or services. Governments set price controls to ensure individuals receive a fair wage at various jobs. Minimum wage positions usually require basic, nontechnical skills. Companies paying workers minimum wage may be able to avoid offering employment benefits. Minimum wage also allows employers to use more part-time workers and avoid overtime pay.
Federal governments use minimum wage laws to ensure a basic quality of life among all citizens within its borders. These laws attempt to improve an individual’s position in the economic income brackets. Rather than have copious amounts of underpaid or poor citizens, minimum wage laws seek a level of economic equality. Governments can use minimum wage laws to force companies to pay all individuals equally, regardless of race, creed, sex or other feature.
. For example, when consumer demand for certain products increases, companies must increase their production output to meet this demand. Increasing supply usually requires additional labor. Companies may forgo additional labor if government price controls force companies to pay employees higher wages than the job position is worth.
If the government requires that certain workers be paid higher wages, then businesses make adjustments to pay for the added costs, such as reducing hiring, cutting employee work hours,...