Minimum wage hike often weakens economy

Posted on April 13, 2009

Bennett Kunert fails to acknowledge the very real consequences of minimum wage hikes, especially indexing the wage rate in his letter on March 22.
Putting minimum wage increases on autopilot — without any mechanism for stopping the increases during a recession — is an extremely misguided policy that is yielding disastrous results for vulnerable employees in the state.

Decades of economic research predicted that there would be an increase in job losses following minimum wage hikes, particularly among vulnerable groups like minority teens and adults without a high school diploma. This job loss is only exacerbated in a weak economy.

In Wisconsin, employers who are seeing demand for their products and services dropping dramatically are forced to cut employees hours and eliminate some jobs entirely in order to stomach automatic wage hikes that take place regardless of the economic climate.

The unintended consequence of reckless, autopilot minimum wage hikes is job loss for the least skilled workers at a time when they need help the most.
Readers and state legislators should realize that a job at the previous minimum wage is much better than none at a higher rate.

Tim Miller
Employment Policies Institute
Washington, D.C.