Wall Street Journal: Delay the Minimum-Wage Hike
Based on 20 years of research, I doubt there is ever a goodtime to raise the minimum wage. However, with the aggregate unemployment rate at 9.4%, the teen unemployment rate exceeding 22%, and the unemployment rate for black teens nearing 40%, next month's increase seems like the worst timing possible.
Despite a few exceptions that are tirelessly (and selectively) cited by advocates of a higher minimum wage, the bulk of the evidence — from scores of studies, using data mainly from the U.S. but also from many other countries — clearly shows that minimum wages reduce employment of young, low-skilled people. The best estimates from studies since the early 1990s suggest that the 11% minimum wage increase scheduled for this summer will lead to the loss of an additional 300,000 jobs among teens and young adults. This is on top of the continuing job losses the recession is likely to throw our way. …
Based on what I've read, my take is that minimum wage increases can benefit low-income workers who already have a job and some work experience. But the minimum wage is a detriment to unskilled inexperienced workers trying to enter the workforce. It may not directly destroy many existing jobs (though it does in some cases), but it does stifle the emergence of new jobs.
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