Will Increasing Minimum Wage Solve Inflation?

Across the United States, the cost of living is on the rise and it shows no warning signs of slowing down. Living in New Jersey, one of the top 10 most expensive states to reside in, only exaggerates this unfortunate reality. What doesn’t seem to be helping the situation is New Jersey’s current minimum wage.

Making ends meet while attending college is nothing short of a difficult task. Most college students only work part-time jobs since classes take up a majority of one’s time and effort. The impending doom of student loans many students anticipate incurring only adds fuel to that fire. If prices continue to increase the way they have, students may not have the luxury to just be students.

Inflation is an increase in prices of goods and services; this becomes much more difficult to deal with when wages don’t reflect this economic shift.

Likewise, New Jersey’s minimum wage is only $13 an hour. If someone works 40 hours a week for $13 an hour, that grosses $520 for a single week of work (excluding taxes). For a month, that same scenario results in $2,080. Possibly half of that money will go towards rent and the other half will attempt to pay for utilities, groceries, car payments, and necessities. Simply, minimum wage does not cut it, nor fit the bill (literally and figuratively).

To maximize the least amount of financial hardship possible, young adults can’t afford to move out of their family home. When my father was my age, he owned his own business, a house, and a sports car. This reality rings true for more people in my father’s generation than it does my own. Our parents were self-sufficient, independent adults in their mid-twenties. It feels like today’s generation can only dream of that level of financial independence.

What good is it to discuss the current pricing bubble if we don’t recognize the catalyst that sent the economy into shock in the first place: the COVID-19 pandemic. This began what has felt like almost three years of mass lay-offs and companies downsizing. With demand high and the supply of workers low, products and materials weren’t making it to our shelves, thus exacerbating the difficulty of sustaining normal routines and creating productive saving habits. Additionally, the war in Ukraine contributed to supply chain issues that has drastically affected gasoline shortages.

Because of the circumstances that currently surround our economy, I feel that it is only fitting that New Jersey’s minimum wage increase to $15, and hopefully even more after that. New Jersey residents can expect this policy to go into effect in January 2023.

With a change like this, maybe students can aspire to the independence our parents once had at our age. Although we all hope that the shortages go away and prices go back to normal, until then, wages have to change so that the average American, let alone student, can afford basic necessities.