Economic Inflation

MINIMUM WAGE WILL CAUSE UNEMPLOYMENT AND INFLATION, SAY THE ECONOMIST

The article, titled, ‘Minimum Wage Will Cause Unemployment and Inflation, say the Economists attracted a lot of attention from various parts of the world. This article basically discussed about the future expected consequences resulting from the minimum wage policy in Malaysia. The economists were expecting that the problem of unemployment, inflation and the development of black market activity will arise after the implementation of this minimum wage policy. There are three main reasons for each problem arises. Firstly, the problem of unemployment will be resulted from the situation where the employers refuse to hire employees at minimum wage and also resulted to the interference of black market. Besides, the economists also stated that the implementation of minimum wage policy will result in the problem of inflation. When the minimum wage increased, the product sellers will eventually increase the price of goods because they expect the consumers to have higher salary.
In opinion, the minimum wage policy has its own pros and contras. The minimum wage policy may benefits the employees as they will feel less burdened about the rising price and increasing in cost of living. The government was in a positive track for providing the workers with such allowance. However, the policy acted in another way around as against the employers as they will feel a little bit burdened to employ more workers because they will have to spend more on the allowance for the workers. Therefore, in curbing the problems of unemployment, inflation and development of black market activity, the government must take some proactive actions in making sure that even if these problem will not be directly solve, it can still be controlled from getting any worser than in this recent time. For example, the government may impose certain restrictions and assign any particular authority to observe each company and set some…