EPI Supports Rhode Island Proposal to Expand Youth Minimum Wage

  • Publication Date: April 2017

  • Topics: Minimum Wage

EPI Supports Rhode Island Proposal to Expand Youth Minimum Wage

Points to research showing value of training wages that keep career pathways open for young jobseekers

Washington D.C. – Today the Employment Policies Institute (EPI) announced support for legislation that would greatly-expand the training wage in Rhode Island, to keep career pathways open for young jobseekers. Rhode Island State Representative Kenneth J. Mendonça is testifying before the House Committee on Labor today in support of legislation he cosponsored that would cap the minimum wage for young employees under 20 years of age at $9.65. (The state’s current training wage law applies to full-time students under age 19 who work at certain nonprofits and community organizations, as well as 14 and 15 year-olds who work fewer than 25 hours in a week.)

A series of minimum wage proposals from the Governor and state legislature would raise Rhode Island’s minimum wage as high as $15 an hour. (The state’s wage floor was increased in four of the last five years.) Most economists agree that a minimum wage increase of this magnitude is counterproductive, and reduces job opportunities for young employees. A study published in Cornell University’s labor economics journal found that training wages at the state level can help cushion the reduction in job opportunities associated with such minimum wage increases.

The press release announcing Rep. Mendonça’s testimony cited EPI’s perspective on how high minimum wages have consequences beyond just the loss of a paycheck for young jobseekers. These consequences extend to the lost opportunity to learn soft skills that can only be learned in the workplace and that set young employees up for future promotions beyond the minimum wage.

This perspective is informed by a 2014 study by economists at the University of Virginia and Middle Tennessee State University which found that early-career work experience has meaningful and lasting benefits. Researchers found that part-time employment in high school students’ senior year was associated with 20 percent higher earnings later in their careers compared with their counterparts. Read the full study here.

“Short of shelving proposed minimum hikes altogether, expanding the youth training wage is the least Rhode Island legislators can do to keep career pathways open for young employees who need it most,” said Michael Saltsman, Managing Director at EPI.

For more information, visit EPIOnline.org. To schedule an interview, contact Sean Kumnick at (202) 463-7650 or kumnick@epionline.org.

The Employment Policies Institute is a nonprofit research organization dedicated to studying public policy issues surrounding employment growth. In particular, EPI focuses on issues that affect entry-level employment. EPI receives support from restaurants, foundations, and individuals.