Politicians are always talking about growing the middle class. But what policies can actually accomplish that goal? Watch this short economics video to find out.
Donate today to PragerU! http://l.prageru.com/2eB2p0h
This video is part of a collaborative business and economics project with Job Creators Network and Information Station. To learn more, visit informationstation.org.
If Democrats and Republicans can agree on anything, it’s stagnating wages. Median family income dropped from $57,790 in 2000 to $56,516 in 2015.
To address the problems, some have pushed to raise the minimum wage to $15 an hour. But only 1.7 percent of the 77 million hourly employees even earn the minimum wage, and just 395,000 are over the age of 25 and earning entry-level wages for entry-level work like cashiers and waiters.
What activists don’t tell you is that raising the entry-level wage increases labor costs for small business owners making it harder for them to keep employees, and hire new ones. This makes it harder for younger employees to gain the skills they need to climb the career ladder, and earn much higher incomes.
Instead of concentrating on raising the floor for low-skilled jobs, we should be focusing on helping people get the skills to raise the ceiling of what people can make. The real fight should be for true middle-class jobs that earn $50,000 or more a year, what we call the Fight for 50. These jobs allow people to save more money, and better support their families.
There are going to be 2.5 million of these middle-skill job openings next year. These career opportunities require more than a high school degree, but less than a four-year college degree, boasting an average salary of $50,000 per year. These jobs include automotive technicians, nurses, and plumbers.
While entry-level employees don’t have the necessary skills to succeed right away in higher-paying roles, they often learn them quickly. One of our most famous politicians started out by scooping ice cream at a Baskin Robbins, and made it all the way to the Oval Office in the White House.
In other words, the entry-level wage should be thought of as a training wage, which employees with few skills can use to prepare for a $50,000 a year, or more, career. Let’s raise wages by putting Americans back to work, and fighting for $50,000.