Policies Harm Young Workers

Regarding the Press-Register’s Aug. 3 editorial, “Minimum wage increase hurts low-skill workers,” federal politicians’ “feel-good” rhetoric — most recently via the July 24 minimum wage increase — merely reinforces policies that result in unemployment for entry-level workers, especially in a weak economy.

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.

As a result of the federal wage hike, a business with 20 entry-level employees will have to absorb almost $30,000 in new labor costs (not including wage increases employers are likely to pay employees making near the minimum wage). Implementing the most recent increase in labor prices without any regard for current economic conditions forces employers to cut hours and eliminate some jobs entirely.

The federal unemployment rate has skyrocketed 70 percent from June 2008 to June of this year. Wage hikes that are meant to help struggling workers actually have the opposite effect of pushing vulnerable workers out of the job market.


Senior Economic Analyst

Employment Policies Institute