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Price floors in the labor market: living wages and minimum wages

In contrast to goods and services markets, price ceilings are rare in labor markets, because rules that prevent people from earning income are not politically popular. There is one exception: sometimes limits are proposed on the high incomes of top business executives.

The labor market, however, presents some prominent examples of price floors, which are often used as an attempt to increase the wages of low-paid workers. The U.S. government sets a minimum wage    , a price floor that makes it illegal for an employer to pay employees less than a certain hourly rate. In mid-2009, the U.S. minimum wage was raised to $7.25 per hour. Local political movements in a number of U.S. cities have pushed for a higher minimum wage, which they call a living wage . Promoters of living wage laws maintain that the minimum wage is too low to ensure a reasonable standard of living. They base this conclusion on the calculation that, if you work 40 hours a week at a minimum wage of $7.25 per hour for 50 weeks a year, your annual income is $14,500, which is less than the official U.S. government definition of what it means for a family to be in poverty. (A family with two adults earning minimum wage and two young children will find it more cost efficient for one parent to provide childcare while the other works for income. So the family income would be $14,500, which is significantly lower than the federal poverty line for a family of four, which was $23,850 in 2014.)

Supporters of the living wage argue that full-time workers should be assured a high enough wage so that they can afford the essentials of life: food, clothing, shelter, and healthcare. Since Baltimore passed the first living wage law in 1994, several dozen cities enacted similar laws in the late 1990s and the 2000s. The living wage ordinances do not apply to all employers, but they have specified that all employees of the city or employees of firms that are hired by the city be paid at least a certain wage that is usually a few dollars per hour above the U.S. minimum wage.

[link] illustrates the situation of a city considering a living wage law. For simplicity, we assume that there is no federal minimum wage. The wage appears on the vertical axis, because the wage is the price in the labor market. Before the passage of the living wage law, the equilibrium wage is $10 per hour and the city hires 1,200 workers at this wage. However, a group of concerned citizens persuades the city council to enact a living wage law requiring employers to pay no less than $12 per hour. In response to the higher wage, 1,600 workers look for jobs with the city. At this higher wage, the city, as an employer, is willing to hire only 700 workers. At the price floor, the quantity supplied exceeds the quantity demanded, and a surplus of labor exists in this market. For workers who continue to have a job at a higher salary, life has improved. For those who were willing to work at the old wage rate but lost their jobs with the wage increase, life has not improved. [link] shows the differences in supply and demand at different wages.

Questions & Answers

if theta =30degree so COS2 theta = 1- 10 square theta upon 1 + tan squared theta
Martin Reply
how to compute this 1. g(1-x) 2. f(x-2) 3. g (-x-/5) 4. f (x)- g (x)
Yanah Reply
hi
John
hi
Grace
what sup friend
John
not much For functions, there are two conditions for a function to be the inverse function:   1--- g(f(x)) = x for all x in the domain of f     2---f(g(x)) = x for all x in the domain of g Notice in both cases you will get back to the  element that you started with, namely, x.
Grace
sin theta=3/4.prove that sec square theta barabar 1 + tan square theta by cosec square theta minus cos square theta
Umesh Reply
acha se dhek ke bata sin theta ke value
Ajay
sin theta ke ja gha sin square theta hoga
Ajay
I want to know trigonometry but I can't understand it anyone who can help
Siyabonga Reply
Yh
Idowu
which part of trig?
Nyemba
functions
Siyabonga
trigonometry
Ganapathi
differentiation doubhts
Ganapathi
hi
Ganapathi
hello
Brittany
Prove that 4sin50-3tan 50=1
Sudip Reply
f(x)= 1 x    f(x)=1x  is shifted down 4 units and to the right 3 units.
Sebit Reply
f (x) = −3x + 5 and g (x) = x − 5 /−3
Sebit
what are real numbers
Marty Reply
I want to know partial fraction Decomposition.
Adama Reply
classes of function in mathematics
Yazidu Reply
divide y2_8y2+5y2/y2
Sumanth Reply
wish i knew calculus to understand what's going on 🙂
Dashawn Reply
@dashawn ... in simple terms, a derivative is the tangent line of the function. which gives the rate of change at that instant. to calculate. given f(x)==ax^n. then f'(x)=n*ax^n-1 . hope that help.
Christopher
thanks bro
Dashawn
maybe when i start calculus in a few months i won't be that lost 😎
Dashawn
what's the derivative of 4x^6
Axmed Reply
24x^5
James
10x
Axmed
24X^5
Taieb
Thanks for this helpfull app
Axmed Reply
secA+tanA=2√5,sinA=?
richa Reply
tan2a+tan2a=√3
Rahulkumar
classes of function
Yazidu
if sinx°=sin@, then @ is - ?
NAVJIT Reply
the value of tan15°•tan20°•tan70°•tan75° -
NAVJIT
what's the easiest and fastest way to the synthesize AgNP?
Damian Reply
China
Cied
types of nano material
abeetha Reply
I start with an easy one. carbon nanotubes woven into a long filament like a string
Porter
many many of nanotubes
Porter
what is the k.e before it land
Yasmin
what is the function of carbon nanotubes?
Cesar
I'm interested in nanotube
Uday
what is nanomaterials​ and their applications of sensors.
Ramkumar Reply
what is nano technology
Sravani Reply
what is system testing?
AMJAD
preparation of nanomaterial
Victor Reply
Yes, Nanotechnology has a very fast field of applications and their is always something new to do with it...
Himanshu Reply
good afternoon madam
AMJAD
what is system testing
AMJAD
what is the application of nanotechnology?
Stotaw
In this morden time nanotechnology used in many field . 1-Electronics-manufacturad IC ,RAM,MRAM,solar panel etc 2-Helth and Medical-Nanomedicine,Drug Dilivery for cancer treatment etc 3- Atomobile -MEMS, Coating on car etc. and may other field for details you can check at Google
Azam
anybody can imagine what will be happen after 100 years from now in nano tech world
Prasenjit
after 100 year this will be not nanotechnology maybe this technology name will be change . maybe aftet 100 year . we work on electron lable practically about its properties and behaviour by the different instruments
Azam
name doesn't matter , whatever it will be change... I'm taking about effect on circumstances of the microscopic world
Prasenjit
how hard could it be to apply nanotechnology against viral infections such HIV or Ebola?
Damian
silver nanoparticles could handle the job?
Damian
not now but maybe in future only AgNP maybe any other nanomaterials
Azam
Hello
Uday
I'm interested in Nanotube
Uday
this technology will not going on for the long time , so I'm thinking about femtotechnology 10^-15
Prasenjit
can nanotechnology change the direction of the face of the world
Prasenjit Reply
At high concentrations (>0.01 M), the relation between absorptivity coefficient and absorbance is no longer linear. This is due to the electrostatic interactions between the quantum dots in close proximity. If the concentration of the solution is high, another effect that is seen is the scattering of light from the large number of quantum dots. This assumption only works at low concentrations of the analyte. Presence of stray light.
Ali Reply
the Beer law works very well for dilute solutions but fails for very high concentrations. why?
bamidele Reply
how did you get the value of 2000N.What calculations are needed to arrive at it
Smarajit Reply
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Source:  OpenStax, Principles of macroeconomics for ap® courses. OpenStax CNX. Aug 24, 2015 Download for free at http://legacy.cnx.org/content/col11864/1.2
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