09-15-2016, 07:56 PM
http://www.pbs.org/newshour/making-sense...-scare-us/
Excerpt:
A recent calculation by James Sherk, a labor economist at the Heritage Foundation, finds that $15 mandates would eliminate about 9 million jobs nationwide. Unskilled workers like those working at fast-food restaurant stand to lose the most from the hike. Based on a national average — not restricted to a high-cost city such as Washington or San Francisco — Sherk estimates that a $15 minimum wage would cause a 36 percent drop in hours worked in fast-food chains. If you’re wondering why more and more McDonald’s restaurants in the United States are atomizing, like they already did in Europe, wonder no more.
But it’s not only jobs and hours that may be lost. Work by Neumark, Wascher and Mark Schweitzer of the Federal Reserve Bank of Cleveland also shows that minimum wages increase poverty — and hence poverty reduction shouldn’t be expected as a benefit of raising the minimum wage. That’s because, contrary to common belief, the relationship between low wages and poverty is extremely weak.
As Neumark, who has done extensive research on the issue, explains, “the principal sources of an individual’s higher earnings are more schooling and the accumulation of experience and skills in the labor market,” both of which are discouraged by increases in the minimum wage. Though an increase raises the wages of some people, it also reduces the employment of others, namely young and low-skilled people.
Excerpt:
A recent calculation by James Sherk, a labor economist at the Heritage Foundation, finds that $15 mandates would eliminate about 9 million jobs nationwide. Unskilled workers like those working at fast-food restaurant stand to lose the most from the hike. Based on a national average — not restricted to a high-cost city such as Washington or San Francisco — Sherk estimates that a $15 minimum wage would cause a 36 percent drop in hours worked in fast-food chains. If you’re wondering why more and more McDonald’s restaurants in the United States are atomizing, like they already did in Europe, wonder no more.
But it’s not only jobs and hours that may be lost. Work by Neumark, Wascher and Mark Schweitzer of the Federal Reserve Bank of Cleveland also shows that minimum wages increase poverty — and hence poverty reduction shouldn’t be expected as a benefit of raising the minimum wage. That’s because, contrary to common belief, the relationship between low wages and poverty is extremely weak.
As Neumark, who has done extensive research on the issue, explains, “the principal sources of an individual’s higher earnings are more schooling and the accumulation of experience and skills in the labor market,” both of which are discouraged by increases in the minimum wage. Though an increase raises the wages of some people, it also reduces the employment of others, namely young and low-skilled people.