Friday, December 13, 2013

Even if an increase in the minimum wage to $10.10 per hour doesn’t cost jobs, it’ll still make unskilled workers worse off

Even if an increase in the minimum wage to $10.10 per hour doesn’t cost jobs, it’ll still make unskilled workers worse off | AEIdeas:
"In other words, let’s buy into President Obama’s recent claim that “There’s no solid evidence that a higher minimum wage costs jobs” (which got a “Two Pinocchio rating” by the Washington Post, indicating “Significant omissions and/or exaggerations.”)

Even if we accept those questionable and unrealistic assumptions above that contradict economic theory and most of the empirical evidence on the minimum wage, we cannot therefore conclude that “increases in the minimum wage have no negative effects on unskilled workers.”

Here’s why:
Even if we assume that the same number of unskilled teenage workers will be employed after a hike in the minimum wage to $10.10 per hour, and assume that there is NO change in the teenage jobless rate, there are many OTHER adjustments that employers would make to offset the monetary increase in labor costs, which would make many unskilled workers worse off following an increase in the minimum wage to $10.10 per hour:"
Read 'em and weep for the children....

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