Regardless of what you think of minimum wage laws (business owners generally hate them while workers and advocates generally favor them), it’s pretty hard to survive on a minimum-wage existence.
Consider this:Â San Francisco and Santa Fe, two cities that maintain their own minimum wage laws (which are higher than both the federal and state wage standards), will raise their rates on New Year’s Day–San Francisco to $9.79 an hour and Santa Fe to $9.92.
I did a quick calculation on what these rates would guarantee a worker.Â In San Francisco, $9.79 an hour would garner $391.60 per 40-hour week and $20,363.20 for a 52-week year.Â In Santa Fe, the equivalents would be $396.80 a week and $20,633.60 a year.
As you can see, that ain’t much.Â It would be hard even to rent a decent apartment and feed yourself on those wages given the high cost of living in both of those places.
However, that still doesn’t resolve the issue of whether minimum wage laws help or hinder the overall economy.
The standard saw against minimum wages has been that it prices the young, unskilled and undereducated out of the economy, thus leading to other costly socialÂ problems.Â Of course, the argumentÂ inn favorÂ is a basic one–if we didn’t guarantee a minimum wage, people would be forced to work for peanuts.
Of course, the way our economy is going, we may all be forced to eat peanuts soon enough, anyway.