WSJ: Job Slayers - Kennedy's minimum wage hikes aggravates poverty problem.

Wall Street Journal ^ | August 29, 2005 | Editorial

[OESY]

Buried within the good news in the recent U.S. job creation report is one sobering statistic: Unemployment among America's teenagers remains stubbornly high at 16%. Even more frustrating is that the jobless rate for African-American teens is close to 33%....

To be sure, many of these teens aren't aggressively searching for jobs.... But what seems equally clear is that teens and unskilled workers face barriers to entry when they attempt to join the job market for the first time. The scandal here is that these barriers are created in large part by liberal policymakers who claim to represent the best interests of unemployed workers.

We are speaking most prominently of the minimum wage, which is again rearing its head in Washington and state capitals. For decades economists have piled up studies concluding that a higher minimum wage destroys jobs for the most vulnerable population: uneducated and unskilled workers. The Journal of Economic Literature has established a rule of thumb that a 10% increase in the minimum wage leads to roughly a 2% hike in teen unemployment.

Which brings us to that renowned compassionate liberal, Ted Kennedy, who wants to raise the minimum wage to $7.25 from $5.15 an hour this autumn. That 40% mandated wage hike would very likely raise the teen unemployment rate even higher. He must think low-wage workers are better off with no job at $7.25 an hour than a real job at $5.15 an hour....

The minimum wage is about the most ineffective poverty abatement program ever conceived....

Minimum wage jobs are predominantly filled by new entrants to the labor force.... [S]tarter jobs... teach people how to work: to show up on time, be courteous to customers, and use time productively.... Without a first job, there can't be a second or third.

[OESY]

But it's at the state level where super-minimum wage laws have become all the rage. This year already, seven states have enacted wage requirements above the federal minimum, bringing the total to 17 (see the nearby table). About 20 states, including California and Massachusetts, have pending legislation or ballot initiatives to raise their wage requirements to as high as $8 an hour.

At the local and state levels these minimum wage requirements are particularly destructive, because many businesses in low-wage industries can simply hop over state borders to less regulated climates. New Jersey raised its minimum wage in the 1990s and suffered a 4.6% loss in jobs in the fast food industry, according to a study by economist David Neumark.

[saveliberty]

LOL! Let the corpulent senior Senator from Massachusetts please testify when HIS office started paying minimum wage.

:-D

What jackassery!

[Just A Nobody]

That 40% mandated wage hike would very likely raise the teen unemployment rate even higher.

But would do wonders to lower the unemployment rate for ILLEGAL INVADERS.

[cinives]

The effective entry wage in many urban and suburban areas is already around $7 per hour, so raising it won't really hurt much of anything. The department stores and fast food joints in my area are all starting hiring at $7 - $8 per hour.

What really hurts teens these days are: 1) illegal immigration and 2) the fact that labor laws and liability rulings have created a hostile environment for employing teens younger than age 16, and even possibly younger than age 18.

Add to all this that teens cannot drive by themselves often until they are 16.5 or 17yo (at least in the NE), and you have a situation where teens are just not as employable as ... illegals.

[A. Pole]

No mention of illegal immigration? Why would WSJ want open borders and to lower the cost of labor? Because it cares for American teenagers and poor Mexicans? Or maybe there is some inferior motive?</p>

[Sinner6]

I am embarrassed to say I work in one of those states and live in another.

[gaspar]

The article states that teenage unemployment remains "stubbornly high" yet the WSJournal doesn't bother to compare it to previous years when teen unemployment averaged about 17.5 in 2004, 17.0 in 2003, 15.8 in 2002 and 15.8 in 2001. Its an annual thing, and probably has as much to do with those who don't want to work, as those who do.

[traviskicks]

Good article. Some more graphs/charts showing what Fund is talking about:
http://www.neoperspectives.com/minimumwage.htm

[bmwcyle]

Inflation gets a liberal boost.

[wilmington2]

Kennedy's is a leftist ideologue who never worked a day in his life and wants to destroy those who have because a a collectivist he wants no one to get ahead of anyone else except for the policy elite. Further in the corruption of our society he is able to wrap himself in the corrupt veil of compassion. Further his party benefits because a minimum wage increase drive out honest employment and brings in Mexicans who in the end will vote illegally of course for the Democrats . Its a win for him for collectivism, compassion and bringing in Mexicans into the Democrat Party as another voting block.