Posted on 01/06/2018 3:27:48 PM PST by free_life
We have been raising the minimum wage for 78 years, and as a new study clearly reveals, 78 years of minimum-wage hikes have produced zero evidence of the "job-killing" consequences these headline writers want us to fear.
In a first-of-its-kind report, researchers at the National Employment Law Project pore over employment data from every federal increase since the minimum wage was first established, making "simple before-and-after comparisons of job-growth trends 12 months after each minimum-wage increase."
(Excerpt) Read more at businessinsider.com ...
The results were clear. Of the nearly two dozen federal minimum-wage hikes since 1938, total year-over-year employment actually increased 68% of the time.
In those industries most affected by the minimum wage, employment increases were even more common: 73% of the time in the retail sector, 82% in low-wage leisure and hospitality.
“These basic economic indicators show no correlation between federal minimum-wage increases and lower employment levels,” the authors write.
In fact, if anything, the data suggest that increases in the federal minimum appeared to encourage job growth and hiring.
Perhaps even more striking, of the only eight times that total or industry-specific employment declined after a minimum-wage increase, the US economy was already in recession (five times), technically just emerging from recession (twice), or about to head into recession (once).
Clearly, this handful of employment downturns would be better explained by the normal business cycle than by the minimum wage.
“As those results mirror the findings of decades of more sophisticated academic research,” the authors conclude, “they provide simple confirmation that opponents’ perennial predictions of job losses are rooted in ideology, not evidence.”
But while there is no evidence that raising the minimum wage is the “risky” “gamble” that doomsayers describe, the devastating economic costs of keeping wages too low are very well documented.
After decades of stagnant wages, 73 million Americans — nearly one quarter of our population — now live in households eligible for the Earned Income Tax Credit, a benefit exclusively available to the working poor.
And according to a 2014 report from the Organization for Economic Cooperation and Development, rising income inequality (and the reduced consumer demand that comes with it) knocked 6% to 9% off US economic growth over the previous two decades.
Wow. If the US economy were 9% bigger than it is today, it would have created about 11 million additional jobs. Imagine how great that would be for both American workers and businesses.
To be clear, I am not suggesting that there’s no limit to how high we can raise the minimum wage. But minimum-wage opponents are not haggling over a number. They are not making a nuanced argument that the minimum wage might be bad for some people if it’s too high or phased in too fast or if the economy is too weak to absorb the change.
No, their core claim is that the minimum wage always hurts the whole economy — that it will always reduce growth— that it is always a sure-fire “job-killer.”
For decades, our minimum-wage debate has been dominated by ideology — the zero-sum claim that if wages go up, employment must inevitably go down — leading even many progressives to believe that the minimum wage is at best a necessary trade-off between fairness and growth.
But 78 years of evidence demonstrates that this old trickle-down model just isn’t true. On the contrary: When workers have more money, businesses have more customers and hire more workers. That is the virtuous cycle that has always described the way market economies actually work.
So if you are genuinely worried about killing jobs, our current $7.25-an-hour minimum wage is arguably far riskier than $15.
Tie minimum wage to inflation and de politicize it.
It does create more robots.
https://www.epionline.org/oped/the-record-is-clear-minimum-wage-hikes-destroy-jobs/
High paying jobs will be replaced by bots too.
Left wing opinion article.
Let’s see a real economist evaluate the data.
I have trouble believing the increases in wage costs increased employment.
You don’t like facts huh? Your link leads nowhere like your shite!
I 100% support this. Set a “base” year, and then ignore it.
Of course, that is not politically viable. To much hay to be made.
It’s Magic!
Robots are not quite what you have been told.
They are expensive to set up, maintain, and easy to break.
They are getting better, but they are not what most people think.
As a conservative I support people who want to work, not the cheap labor express. I have never believed the pay people less and they benefit bs. Maybe all wages should be under $1.50 then we all could have 2 or 3 jobs.
According to Thomas Sowell, the purpose the first federal minimum wage law/last Jim Crow law, the Davis-Bacon Act of 1931, was to stop blacks from underbidding white union members on federal contracts.
According to Sowel 1931 was also the last year the black unemployment rate was lower than the white unemployment rate.
https://www.realclearpolitics.com/Commentary/com-11_15_05_TS.html
At $725 it isn’t even keeping up with the 1960’s adjusted for inflation.
So the people who think that employers shouldn’t know if they’re hiring felons also has ‘clearly demonstrated’ that minimum wage hikes mostly lead to higher employment.
You’ll have to excuse me if I’d want someone reputable to actually do that verification rather than taking them at their word, since they are little more than a liberal advocacy group who’s fight for ‘income inequality’ mostly revolves around ensuring that union labor contracts contain automatic raises for minimum wage hikes.
What a giant, steaming pile of bullshiite. There are a gazillion studies over the years to not only prove raising the minimum wage kills jobs, it hurts the uneducated (and stupid—my words) most of all. Look what Seattle did recently. The data is already in for that fiasco.
Give it a couple months, and this dumb study will be destroyed. Probably by Heritage.
Seriously, your premise defies common sense and experience. If raising the minimum wage leads to prosperity for everyone, make it $50/hr and we’ll all be rich!
Demand side economics fails every time it is tried. See Paul Krugman and his history of bad predictions for the current best examples.
This bs study would have Milton Friedman laughing hysterically.
Geeze.
>>>At $725 it isn’t even keeping up with the 1960’s adjusted for inflation<<<
$725 an Hour? Where do I sign up?
In Seattle they voted to raise minimum wages to $15 an hour a couple of years ago. A study was done not so long ago, go read the results and see how many jobs were lost how many companies shut down, how many businesses left the area.
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