Minimum wage hurts teen job-seekers
Author: Kristen Eastlick
Publication Date: June 2008
Newspaper: San Antonio Express-News
Topics: Teen Unemployment
Summer is here. And thanks to misguided politicians, Texas teens are more likely to be sitting in front of the TV than waiting tables or scooping ice cream.
This year, it?s harder than ever for teens to find a summer job. Researchers at Northeastern University described summer 2007 as the worst in post-World War II history for teen summer employment, and those same researchers say that 2008 is poised to be – even worse.
According to their data, only about one-third of Americans 16-19 years old will have a job this summer, and vulnerable low-income and minority teens are going to fare even worse.
The percentage of teens classified as unemployed those who are actively seeking a job but cant get one is more than three times higher than the national unemployment rate, according to the most recent Department of Labor statistics.
One of the prime reasons for this drastic employment drought is the mandated wage hikes that policy makers have forced down the throats of local businesses. Economic research has shown time and again that increasing the minimum wage destroys jobs for low-skilled workers while doing little to address poverty.
According to economist David Neumark of the University of California at Irvine, for every 10 percent increase in the minimum wage, employment for high school dropouts and young black adults and teenagers falls by 8.5 percent. By the middle of July, when the new wage goes into effect, the Texas minimum wage will have increased by nearly three times that amount in a 13-month period!
The classic summer jobs – cashier, waiter, grocery clerk – can help an employer with increased service or make up for full-time employees who take vacations. When the minimum wage gets boosted, however, employers cut down on hiring teens that typically fill lower-priority slots.
Research from the University of Georgia, the University of Connecticut and Cornell University indicates that increasing the minimum wage causes four times more job loss for employees without a high school diploma than it does for the general population.
Furthermore, minimum wage hikes don?t effectively target the people whom typically portrayed as the key beneficiaries low-income adults raising kids. According to U.S. Census Bureau data, just 14 percent of those who benefited from the most recent federal minimum wage hike are sole earners in families with children.
A summer job for a teen is much more than a paycheck: It’s a chance to gain important skills, increase one’s value to future employers and ? just as important learn what it?s like to have a job! But ill-advised policy-makers are blinded by the basement salary figure instead of looking at the big picture.
Mandated wage hikes have negative consequences that too many politicians are ignoring. Hopefully I hope some of them will discover the truth when they return home this summer to find their teenage children stuck languishing on the couch.
Kristen Lopez Eastlick is the senior economic analyst at the Employment Policies Institute.