‘May Day’ marchers out of step with minimum wage experts

Original Article: https://origin-nyi.thehill.com/blogs/pundits-blog/economy-budget/331983-may-day-marchers-out-of-step-with-minimum-wage-experts

  • Author: Jordan Bruneau and Michael Saltsman

  • Publication Date: May 2017

  • Newspaper: The Hill

  • Topics: Minimum Wage

This week, coordinated May Day protests took place in major cities across the country. Among the marchers’ many demands: a $15 national minimum wage.

The demonstrations come on the heels of last week’s $15 federal minimum wage legislation introduced by Sen. Bernie Sanders and co-sponsored by 22 progressive Senators.

But expert opinion is out of step with these literal and legislative marches.

A 2015 survey of U.S.-based labor economists conducted by the University of New Hampshire (UNH) finds that nearly three quarters of respondents oppose a $15 minimum wage. Five in six respondents say that it will cause job loss among young employees.

Minimum wage advocates try to paint opposition to such wage hikes as “right-wing” efforts driven by “corporate lobbyists.”  But reality doesn’t match this rhetoric.

Fifty-nine percent of the economists surveyed by UNH identify as Democrats, while just seven percent identify as Republican. And prominent left-of-center economists associated with the Obama and Clinton administrations have advised against it. Harry Holzer called a $15 minimum wage “extremely risky,” while Katharine Abraham said she is “concerned” about what it would do to employment.

This week, coordinated May Day protests took place in major cities across the country. Among the marchers’ many demands: a $15 national minimum wage.

The demonstrations come on the heels of last week’s $15 federal minimum wage legislation introduced by Sen. Bernie Sanders and co-sponsored by 22 progressive Senators.

But expert opinion is out of step with these literal and legislative marches.

A 2015 survey of U.S.-based labor economists conducted by the University of New Hampshire (UNH) finds that nearly three quarters of respondents oppose a $15 minimum wage. Five in six respondents say that it will cause job loss among young employees.

Minimum wage advocates try to paint opposition to such wage hikes as “right-wing” efforts driven by “corporate lobbyists.”  But reality doesn’t match this rhetoric.

Fifty-nine percent of the economists surveyed by UNH identify as Democrats, while just seven percent identify as Republican. And prominent left-of-center economists associated with the Obama and Clinton administrations have advised against it. Harry Holzer called a $15 minimum wage “extremely risky,” while Katharine Abraham said she is “concerned” about what it would do to employment.

Democratic legislators have also recently opposed dramatic minimum wages. This spring, Democratic Mayor of Baltimore Catherine Pugh vetoed $15 municipal minimum wage legislation. She pointed out that such an increase in starter wage labor costs would negatively impact city small businesses, including her own. (Her consignment store would have been forced to close an extra day a week if the bill had become law.)

Democratic legislators have also recently rejected $15 minimum wages in Montgomery County, MD and Cleveland, where Democratic city councilors then worked with state legislators to set one minimum wage at the state level and avoid the confusing patchwork of wage legislation that could occur from local increases.

Even opposition to less dramatic wage hikes than double the historical, inflation-adjusted average of $7.40 cannot be painted as ideological. In a 2014 report, the nonpartisan Congressional Budget Office found 500,000 jobs would be lost nationally at a $10.10 federal minimum wage. And in a 2015 study, the Federal Reserve Bank of San Francisco found that previous minimum wages cost jobs “with possibly larger adverse effects than earlier research suggested.”

These job losses are already occurring in the real-world. In California’s Bay Area, which is phasing in a $15 minimum wage, there has been what one local publication calls a restaurant “death march,” with dozens of recent labor cost-induced restaurant closures. In New York State, longtime eateries like Del Rio Diner and Bob and Ron’s Fish Fry that have survived generations have recently gone out of business with the owners citing the state’s dramatic minimum wage increase as the death knell. (Specific stories can be found at Facesof15.com.)

Perhaps the clearest evidence of the folly of $15 wage legislation is that the progressive legislators who introduced it seem to oppose $15 in practice if not in principle. Most of the Senate 22 co-sponsors hire interns at a $0 hourly wage; none pay $15 an hour. They may claim that the costs associated with paying their intern employees $15 an hour would reduce the number of these valuable training opportunities. But the exact same dynamic exists in the private sector.

While May Day protesters march for higher wages, expert opinion and observable reality suggests they’re marching themselves into a future with fewer job opportunities.