Although this increase seems as if it could benefit the economy because it moves entry level workers close to a liveable wage, the impacts are not all positive.

According to Target, there are currently 323,000 workers on their payroll qualifying as low-wage hourly employees. According to the Bureau of Labor Statistics, Target’s annual operating cost will increase by over a billion dollars each year the new minimum wage is in effect.

One of the ways Target may make up the cost of raising the minimum wage is by raising prices on their products, which will decrease the buying power of the dollar and thus accelerate inflation.

Another drawback of increasing the minimum wage is with rising labor costs, companies make cutbacks on labor to minimize unnecessary labor expenditures. According to a study conducted by the Federal Reserve Bank of Chicago, a 10 percent increase in the minimum wage results in a four percent decrease in the number of low-wage jobs available.

In 2016, the minimum hourly wage in Seattle experienced a hike from 11 dollars to 13 dollars. Economists from the University of Washington studying the increase reported a three percent increase in overall wages by low-wage workers, but a nine percent decrease in the number of hours worked by such workers. This resulted in a net loss of $125 a month per low-wage worker on average.

Not only is increasing the minimum wage ineffective in boosting workers above the poverty line, it actually takes money out of the pockets of low-wage earners who need it most.