Discussion on Who Earns the Minimum Wage and Understanding Federal Reserve

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Macroeconomics
Chapter 15
The case study, “Who Earns the Minimum Wage?” raises crucial questions. Notably, the minimum wage law is only effective when wages are not above the equilibrium level since when that happens, it leads to high unemployment rates. The Department of Labor affirms that the minimum wage has remained at $7.25 per hour for a long period. For instance, 80 million employees were paid based on the hours they worked in 2017 (“Who Earns the Minimum Wage” 300). Among those employees paid at hourly rates, approximately 2.3% affirmed that they were paid at or below the minimum wage.
When it comes to young workers between the ages of 16 and 19 years, around 8% were paid at or below the minimum wage. Additionally, less educated individuals aged 16 years and above without a high school certificate comprise about 4% of those being paid at or below the minimum wage. Approximately 2% of those with a high school diploma belong to this group of low earners. In addition, part-time employees working less than 35 hours a week constitute 6% of those paid at or below the minimum wage compared with 1% of full-time workers (“Who Earns the Minimum Wage” 300). The hospitality and leisure industry tops the list of employees paid at or below the minimum wage. In particular, about 3/5 of these workers fall in the low-earner class. As such, it appears as if employers look for things t...