Predicted Unemployment

Posted on January 20, 2010

Democrats’ proposed job creation plan will only add to the $12 trillion national debt while ineffectively handling the country’s double-digit unemployment rate. A better idea would be to revisit the burden Congress has placed on employers through a 40 percent increase in the minimum wage.

In 2007, when Congress passed the Fair Minimum Wage Act, my colleagues and I warned about the unintended consequences of forcing higher labor costs on employers. Research repeatedly shows that increasing the minimum wage triggers unemployment for vulnerable groups like African-American teens.

Two years later, those warnings are now a painful reality, with half of African-American teens seeking jobs unable to find one.

It doesn’t take a “jobs summit” and billions in taxpayer dollars to provide jobs for the unemployed. Congress should take steps to lessen the financial burden minimum wage increases have imposed on employers, allowing them to hire workers with greatest need for experience and income.

Kristen Lopez Eastlick
Washington, D.C.
The writer is senior economic analyst with the Employment Policies Institute.