How the 2024 election could affect your salary

With the 2024 presidential election just around the corner, Americans are keeping a close eye on what the election results could mean for their country. pay slips.

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Presidential candidates Donald Trump and Kamala Harris are proposing very different approaches to tax policy, the minimum wage and labor law – each with direct consequences for the average salary and financial well-being of workers.

This is what you might see as each candidate’s proposed policies become law.

Tax policy and your net salary

Tax policy changes are one of the most direct ways the election can affect your paycheck. Adjustments affect how much disposable income employees take home, meaning taxes directly affect net income.

“A government focused on business incentives could opt for tax cuts that improve corporate liquidity, potentially leading to wage increases or bonuses,” said David Brillant, a tax attorney in Northern California.

Traditionally, Republican candidates like Trump have prioritized issues such as tax cuts, lowering corporate taxes or easing the tax burden on high earners. In this election, Harris, the Democratic nominee, has said she favors tax policies that raise tax rates on the wealthy and provide tax breaks to middle- and lower-income workers.

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Financial experts suggest that these tax proposals will have far-reaching implications for workers across all industries. For example, a cut in corporate taxes could encourage companies to hire more people or raise wages.

However, a recent study found that austerity does not always pay off with higher wages in low-wage sectors. So workers may see pay increases if their employers pass on the benefits, but this is not guaranteed.

On the other hand, Harris’ proposal to shift taxes to higher earners and lower rates for middle-income earners could directly help workers. For families living paycheck to paycheck, this can bring immediate relief and create much more disposable income.

Minimum wage policy and earning potential

After the election, the minimum wage could also be a factor; each candidate has put forward different priorities in this area.

Harris has made clear she wants to raise the federal minimum wage to $15 an hour to combat income inequality and give stability to millions of low-wage workers. This proposal is in line with the fact that more and more states want to increase minimum wages due to the rising costs of living.

If Harris’ promise to raise the minimum wage to $15 gains traction, many lower-income Americans could benefit from a substantial annual salary increase. As such, this policy could help boost many workers, but it could also pose challenges. In particular, some economists say a rapid increase in the minimum wage could prompt employers to cut hours or reduce workforces to keep businesses profitable in sectors such as retail and hospitality.

Trump has been non-committal on a federal minimum wage, saying states should be given the power to decide. Even with this state-based approach, minimum wage increases may not rise evenly from state to state. But Trump has also advocated eliminating the tip tax for workers, which could make up for the lack of hourly wages for workers in states with the lowest minimum wages.

Changes in labor policies and regulations

Another area where voters’ choices will directly impact paychecks is labor policy, specifically employee rights, benefits and job security. Stronger worker protections, especially on issues like paid family leave and health care benefits, are part of Harris’ platform. Better worker protections could create more financial stability for families who need reliable sick or parental leave.

Under either administration, the labor law landscape could completely change, as one approach would promote worker protection while the other would deregulate to spur business growth.

The gig economy and the classification of workers

The election results could have major implications for gig workers and independent contractors. Harris has also supported reclassifying gig workers as employees, granting them minimum wage protections, overtime pay and health care benefits.

However, the changes may not go down well with many gig economy companies, such as ride-share and delivery platforms, which have warned that such rules could undermine the flexibility enjoyed by both workers and businesses.

The gig economy is an opportunity to redefine it, to reshape how millions of Americans earn a living and, by extension, how overall wages are affected as employers respond to shifts in labor costs.

This differs from Trump’s policies, which generally supported the status quo. Some experts think Trump would prefer to keep gig workers classified as independent contractors. Between worker reclassification and independent status, the decisions made could directly impact people working in the gig economy.

Workplace equality and anti-discrimination measures

Harris’ platform has focused on workplace equality — closing the gender pay gap and increasing diversity — but it’s unclear what her priorities will be behind closed doors. Harris wants to increase the quality of workplace culture and create fair pay by implementing policies that address equal pay and discrimination.

These could be policies that help shift wages outwards so that they are fairer by gender. In some industries, gender and wage gaps have been more dramatic.

Trump focuses on encouraging companies to voluntarily pursue equity practices. Those in favor of this approach say it is flexible, while opponents suggest voluntary initiatives will not bring about major change. Both candidates of either approach understand that an inclusive workforce is essential, but they differ in that approach.

Editor’s Note on Election Coverage: GOBankingRates is nonpartisan and committed to covering all aspects of the economy objectively and presenting balanced reporting on politically focused financial stories. More information on this topic can be found at GOBankingRates.com.

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