$15 wage will become $0 for some low-end workers
Original Article: http://www.ocregister.com/articles/wage-709558-minimum-most.html
Author: Michael Saltsman
Publication Date: March 2016
Newspaper: OC Register
Topics: Minimum Wage
Proponents of a higher minimum wage in California have gathered enough signatures to put a $15 minimum wage to a vote in November. It’s good news for unions, but what does it mean for Californians who are uniquely unqualified for basics tasks of the working world?
The National Center for Education Statistics recently released a report that takes a closer look at this segment of the working-age population in the United States. The results are unsettling.
The researchers measure competency in three core areas: literacy, problem-solving and numeracy. Performing at the most basic level in each category is defined as the ability to read short texts, assign items to categories using widely available technology (i.e. email), and simple math involving counting or sorting.
The study’s top-line finding is that American adults lag their counterparts abroad in each of the three categories. They particularly struggle in the areas of numeracy (12 points below international average) and problem-solving (9 points below international average). Young adults ages 16-34 with a high school diploma or less constitute a large percentage of those underperforming in all three areas.
Here’s the most alarming part: When the researchers looked at unemployed Americans, they found that nearly three-fourths score at the bottom levels of problem-solving, and 42 percent perform at level one or below in numeracy. This implies they’d struggle with the rudimentary tasks of counting money, using a touch screen to catalog an order, or reading a restaurant menu.
Put differently, the people most in need of work appear to be the least qualified to get offered a job.
These results pose an obvious question for voters and policymakers: Will a $15 wage put already-struggling job seekers at an even greater competitive disadvantage? Are voters aware of the unintended consequences?
California doesn’t have a margin of error to find out. The state’s minimum wage is already among the highest in the country. Not surprisingly, the unemployment rate for young adults in California – who are more likely to be negatively affected by a higher minimum wage – approaches 21 percent.
These businesses aren’t scaling back or closing because they’re hard-hearted; they’re doing it because it’s their only choice. If customers won’t pay for cost increases through higher prices, the only other option is to reduce labor costs elsewhere, or find someone more experienced to do the job. In either case, it’s the least-skilled employees who are typically the first to go.
We need economic solutions for underqualified jobseekers that do more than poll well among the general public. The University of New Hampshire recently surveyed labor economists on whether they supported a broad $15 wage mandate. It’s said that economists can’t agree on anything. In this instance 83 percent agreed that a $15 minimum wage would reduce youth employment levels.
It’s to this consensus that California should look if it wants to do more than provide lip service to its most needy citizens this fall.