Minimum wage hikes harm the least skilled workers
Government-mandated minimum wage hikes hurt the lowest-income earners because they reduce the number of beginner-level jobs overall and slow the rate at which remaining jobs become available. Amazingly, advocates for this political malpractice admit both of these negative impacts!
The stated intent of the mandated wage hike; to “give” greater purchasing power to minimum-wage earners is absurd on its face:
The lowest wage affords lowest-wage purchasing power no matter what number is affixed to it; Its relationship to the broader economy is not changed by reassigning the number by force-of-law.
Advocates for government-mandated wage hikes claim that “costs to employers are offset by reductions in turnover.” Let’s assume their claim about employer-costs being offset is completely true. Is it desirable?
Lower turnover on the first “rung” of the job ladder means:
- People move more slowly from step one to step two and beyond. Even assuming that our government has a moral right to induce constipation at the entry level of the job market, how does doing so move people out of poverty?
- Less frequent openings are created for beginners coming up behind. Why would we want to create that outcome – by force-of-law?
If the intent were to help people move out of poverty, the focus would be on economic MOBILITY; the relative ease with which beginning-level workers (or re-starters) can engage the labor market and move up from entry level.
Any policy which purposely moves the lowest rung of the ladder further from reach of the least skilled worker and then slows the rate at which he/she moves up is designed to keep the lowest workers down. Who is helped by this? Only the politicians who are adept at converting class-envy and economic stagnation into a permanent constituency – one that can be counted on to set up a raucous of protest in response to proposals which seek to free the private economy from the chains which create dependency.
When I wrote on this topic last year, the call for doubling minimum wage by force-of-law was limited to the more left-leaning of individual states, where, predictably, they succeeded. The entry-level workers of those states will now find it increasingly difficult to find a job, and finding one, will feel obliged to hang on for dear life no matter the tedium because they will now be monetizing their time at a rate greatly exceeding the value they are able to generate for their employer. Needless to say, employers in these states will take measures to limit their exposure to the harm done by a law that forces inequity in their labor relationships. Employers will find workarounds. It’s the entry-level worker who will be irreparably harmed by a law that prices his or her services out of the market.
Only the power of the combined States – convened under Article V of the US Constitution – is equal to that of the Federal Government. Only an Article V Convention can make Amendment proposals which pull power from the Federal Government and return it to the people via the states.
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