"In what has become a running joke amongst those skeptical of the claim that minimum wage increases have no effect on unemployment, a recent report by the Employment Policies Institute showed that 174 of the 184 co-sponsors of a bill to raise the federal minimum wage to $15 an hour hired unpaid interns."
"In a review of over 100 studies, economists David Neumark and William Wascher found that,A sizable majority of the studies surveyed ... give a relatively consistent (although not always statistically significant) indication of negative employment effects of minimum wages. In addition, among the papers we view as providing the most credible evidence, almost all point to negative employment effects, both for the United States as well as for many other countries." http://www.nber.org/papers/w12663.pdf
"Yes, minimum wages still do increase unemployment."
https://mises.org/blog/seattles-minimum-wage-supporters-ignore-facts
(Score: 0) by Anonymous Coward on Sunday July 30 2017, @01:05PM (2 children)
Most businesses don't know how many customers are going to buy from them tomorrow.
For these, investment in the business, including hiring, is an act of faith.
It comes from a fixed pot of extra cash flow that the owner feels is worth risking.
Raising the required wage changes the risk equation and on average will lower hiring.
The fear of not meeting payroll makes the business owner think long and hard about the best way to spend his extra cash flow.
Automation, productivity, and taking profits are competing with more wages to optimize the owner's use of the business.
Raising minimum wage is not a free lunch.
The closest thing to a free lunch I know is what Reagan managed to do in the 80's.
He brought about an overall optimism that changed the risk equation.
(Score: 0) by Anonymous Coward on Monday July 31 2017, @10:07PM (1 child)
That is definitely true. But, I'd also point out that a business that is that close to being bankrupt should be extremely nervous whether or not there's a change to the minimum wage. The minimum wage hike in this case was abnormally large, and probably did cause an abnormal amount of anxiety, but counting on employees to subsidize an inefficient business is a road to nowhere.
(Score: 1) by khallow on Monday July 31 2017, @11:48PM
That's a terrible way to describe what's happening.