The increased wage plays an important role ensuring all workers share in a growing economy. The more money a person has, the more the person is willing to spend. This spending is an opportunity for businesses to increase prices. If employers are forced to increase wages, they must have the choice of passing the increase to consumers through prices. The benefits of retaining some inflation are probably over sighted. Price stability reduces uncertainty and offers the best economic environment for firms and households (Feldstein).
According to Audrey Cormack, "the minimum wage should be high enough to allow people to live with dignity. She points out that if the government does not get involve and introduce regular increases to compensate for inflation, the real value of minimum wages will drop. One time increase to the minimum wages will not solve problems. What is needed is a system that makes regular adjustments for inflation." An analysis by the Council of Economic Advisers (CEA) showed that the minimum wages increase of 1996 and increased minimum wages in some states were responsible for 10 to 16 percent of the decline in welfare caseloads between 1996 and 1998. The increased wages ensure parents can raise their children out of poverty. .
There are disagreements about the increase in wages. According to Executive Secretary Ronaldo Zamora, "a general wage hike would be counter productive and may only increase inflation." He maintains that it is best to let the regional wage and productivity boards decide on the pay hike adjustments sought by some labor groups. He also added that the government maintains its position that all wage hikes must be linked to corresponding productivity increases. As wages are too high in richer countries, making money is about greed, or taking more than enough to live. This is sending many of the hardest working people into debt and unemployment, while less hard working and fraudulent people are making a fortune.
