Should minimum wage be tied to the rate of inflation?

My instinct tells me yes, but I am, in no way, an economist — so I can’t say for sure.

Interested to see what smarter folks than I have to offer.

@cookieman I totally agree,that’s why I asked it of course there will be a few that say no,but would like to hear their reason as to why as well.

I don’t know all the angles, but wouldn’t indexing it to inflation always insure inflation would happen?

@Adirondackwannabe good point,and don’t want to hurt small businesses ,but do want to stop the large corporations of just having wage slaves.

@Adirondackwannabe No, Indexing does not mean inflation will happen. Social Security has had Cost Of Living Adjustment (COLA) for thirty years, yet inflation the last fifteen has been minimal and driven by other factors.

If the minimum wage was indexed, we wouldn’t be going through these arguments every couple years.

@zenvelo I’m not sure I would tie the COLA adjustments for Social Security to inflation. It’s not a cost of production, like wages. Indexing also doesn’t adjust for productivity or efficiency gains, manufacturing improvements, etc.

Of course it should. Inflation means the value of money decreased every year. If the absolute value of the minimum wage stays the same, it means that in reality the minimum wage decreases relative to the currency’s purchasing power.
1$ in 1960 would be the equivalent of 7$ today.

Well, it does, but it doesn’t go up as fast as inflation. In the 70’s minimum wage in Kansas was like $1.50 (I think.) Today it’s $7.25.

For the economy to work, people need to buy shit. If minimum wage doesn’t go up and all you can buy is Kraft Dinner, shit’s gonna hit the fan. (not that it hasn’t, already)

Yes it should be otherwise it quickly becomes less than the minimum wage which by definition is not what was intended.

No. It should be tied to the cost of living index and called a living wage.

@Blondesjon Now that I totally agree with.

That sounds like a great idea. All wages (reasonable ones) should be tied to inflation.

It’s a vicious circle. Raise the minimum wage and someone else has to raise his prices to compensate, so some other person has to raise his prices to compensate, and so on until it all comes back to the first guy who now has to raise his wages again to keep up.

Wages are tied to job skills. Minimum skills equals minimum wage. Why not increase the job skills so the employee is more valuable and makes more?

And what happens to the wages that are tied to more advanced skills as the minimum wage increases? Who is going to push for those to rise with minimum wage? Or do we eventually get to a point where everyone is making the same thing, regardless of skill and education? Not all employers give annual raises across the board.

We have done this in Oregon for many years. My rent is still the same and Wendy’s still has a 99 cent menu. If anything food costs have gone up more due to rising gas prices than minimum wage increases.