Study: Minimum wage hikes don’t kill jobs

NJ101.5 ^ | 7/21/2014 | Kevin McArdle

[Incorrigible]

 

It's one thing to have representatives vote to increase the minimum wage. But stupid New Jersey voters allowed the politicians to become completely unaccountable on this issue by making the raise automatic each year. Ugh.

 

[GraceG]

No, they simply kill future hiring....

at the “best”.....

[gr8eman]

“Honestly it’s too early to tell”...Really? So If Mickie Ds has to raise their minimum salary....they raise their overhead, stop turning a profit and go out of business. Wait...sorry...we'd have to do math then!

[Above My Pay Grade]

“CEPR acknowledges this analysis is far from scientific and draws no direct link between raising the minimum wage and payroll gains. Still, “it does provide evidence against theoretical negative employment effects of minimum wage increases,” CEPR researcher Ben Wolcott writes.”

So, the author of the study admits it proves nothing.

Tiny increases in minimum wage have very, little effect, either positive or negative, as very few people are affected.

Massive increases like the $15.00/hr rate coming to Seattle will kill thousands of jobs, and would kill millions if implemented nationally.

[Buckeye McFrog]

I have an idea....let’s raise the Minimum Wage to $47.50 an hour. By this logic it will quickly drive unemployment down to 2%.

[GeronL]

bump

[BookmanTheJanitor]

A new study by the Center for Economic and Research Policy

no mention that this is a liberal/progressive group....hmmm. A conservative group would undoubtedly be identified as such.

[mosesdapoet]

All this legislation does is devalue the purchasing power of the dollar and affixes a continuous inflationary sprial on it which causes the coin of the realm eventually to become valueless.

[circlecity]

Because we all know it’s a fundamental law of economics that increasing the cost of something has no effect on the demand for that thing.

[rockinqsranch]

Just like the Democrats unfunded mandates are intended to tie up State funds to cause the States to be more vulnerable to Federal financial assistance, manipulation, and ultimately control, so is the Democrats minimum wage scheme.

Be minimum wage Democrat instigators Federal, or State it doesn’t matter as it’s always the Democrats, and their intent is to assault capitalism by driving up costs.

[KC_Conspirator]

The CEPR is a total leftwing, pro-union, anti-business, Occupy Wallstreet, special interest group.

[mulligan]

Figures may not lie but liars figure.

[Sooth2222]

"The Center for Economic and Policy Research (CEPR) is a progressive economic policy think-tank."

So if it doesn't cost jobs, why not make it $100? Why not $1000? (In reality, all a minimum wage does is make it illegal for anyone whose labor is not worth the minimum wage to work.)

[The Great RJ]

If you consider the economics a loss of jobs is inevitable. Consider a worker making $10 per hour. That worker must produce at least $10 of revenue per hour worked just to pay their wage and more if you consider other costs of production. If you raise the wage, productivity must be increased to produce the added revenue per hour needed to pay the wage increase. Worker productivity can be increased by automation making workers more productive per hour worked, but that often means fewer workers will be needed. Productivity can also be increased by reducing the number of workers. For example, replacing part time workers with fewer full time workers.

Keeping all variables the same but just increasing wages can also be accomplished by increasing prices. However, in a competitive market that may not be possible. For example it might be more efficient to just move production offshore where labor costs are cheaper and keep prices competitive.

Some will argue that businesses just cut profits to pay higher wages. However on average businesses make only about 6% profit on a dollar of sales and much less in many businesses. For example grocery stores operate at a profit level of about 1%. Again liberals will maintain even that even that level of profit is "excessive", but fail to realize that businesses do not work on a break even basis as entrepreneurs will not accept the risks of operating a business with no potential of economic profit.

The bottom line is that increasing wages above reasonable productivbity levels will result in fewer jobs.

[cuban leaf]

All this legislation does is devalue the purchasing power of the dollar and affixes a continuous inflationary sprial on it which causes the coin of the realm eventually to become valueless.

---

A person projected into our time from the year, say, 1880 would say that has pretty much already happened.

[stars & stripes forever]

“Study: Minimum wage hikes don’t kill jobs”

However, it DOES kill customers who cannot afford the price hikes.

[qman]

Progressive think tank talking points, never listen to any think tanks talking points, conservatives either, they both have an agenda and are propagandists. If you really need proof of something go directly to the source where ever that might lead!!!

[BfloGuy]

It is a no brainer because that money was going to immediately be coming right back into our local economy,

If I take $500 out of the cash drawer at a supermarket and turn around and buy $500 of groceries with it, the grocer -- or the local economy -- is not better for it.

[VRWCmember]

Because we all know it’s a fundamental law of economics that increasing the cost of something has no effect on the demand for that thing.

The fundamental law of economics (i.e. the Law of Demand) states that increasing the cost of something will decrease the QUANTITY DEMANDED of that good; however a change in price does NOT have any effect on the DEMAND for the good. Demand is the relationship between price and quantity demanded. In other words, Demand is the entire line -- or curve -- on the graph rather than just points on the curve. An increase or decrease in demand means the quantity demanded changes at every price. When you change the price, the curve does not shift; you just move to a different point on the curve. Thus, an increasing price does NOT have any effect on the demand for that thing, only an impact on the quantity demanded.

Things that have an effect on the demand for a good (i.e. Determinants of Demand) include:
Changes in Income and Wealth of buyers in the market,
Changes in price or availability of substitute goods,
Changes in price or availability of related goods,
Changes in the number of buyers in the market,
Changes in demographics and consumer tastes, etc.

Changes in these factors impact the quantity demanded at every price and therefore cause the entire demand curve to shift to the left (decrease) or right (increase).

This brief refesher from Basic Economics 101 is brought to you by the letter "D" (for Demand).

[GeronL]

bump