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JOBS: Wage mandates hurt teens seeking jobs

Letter by Michael Saltsman, Washington, D.C. on June 8, 2010 at 12:48 pm with 29 Comments »
June 8, 2010 12:59 pm

Re: “Tri-City teens sing summer job blues” (online, 6-6).

Teens will have a tough time finding a job this summer, and one often overlooked reason is wage mandates that create a barrier between teens who want to work and employers who want to hire.

Between July 2007 and July 2009, Congress increased the federal minimum wage 40 percent. Recent research from Ball State University attributes the loss of 310,000 teenage part-time jobs to this wage hike.

At $8.55 per hour, Washington mandates the highest wage rate in the country. Minimum wages raise the cost of hiring and training entry-level employees like teens. Employers respond by cutting staff hours or positions and are forced to turn to more cost-effective alternatives like automation and self-service.

These unemployed teens are deprived of the valuable invisible curriculum that comes from reporting to a supervisor, showing up on time and working with others as part of a team. Research from Northeastern University found that teens without job opportunities – especially economically disadvantaged teens – are also more likely to drop out of high school or get tangled up in the criminal justice system.

(Saltsman is a research fellow with the Employment Policies Institute, a business-funded lobbying organization based in Washington, D.C.)

Leave a comment Comments → 29
  1. fatuous says:

    Don’t you have anything better to do. Like buying off some Senator or Representative.

    The citizens of Washington state can take care of our own business without any input from lobbyist scum!

  2. larsman says:

    Mike, I agree with you. Faced with increased Big Brother mandates that sound good for elections, most businesses will do just as you have mentioned. A minimum requirement now becomes a maximum ceiling.

    The state says you have added requirements ( B. and O. taxes) with 4 or more employees? Hire three or less , cut hours or work them harder.

  3. Sumner401 says:

    “a business-funded lobbying organization”

    I wonder what their agenda is?

  4. “….a business-funded lobbying organization…” The agenda is pro business.
    The question should be: why was this letter published and why was the writer identified as a pro business lobbyist?

    As a side note, what is evil abut promoting business or having differing opinions about minimum wages?

  5. aislander says:

    I am astounded by the reason and logic employed by lefties in refuting Saltsman’s letter. Oh, that’s right: there wasn’t any reason and logic employed by lefties, but why should they start now…

  6. Sumner401 says:

    Reason and logic would require some proof of the writers contentions, there is none.
    It would also require some proof that lowering the min wage would increase the number of jobs, and there is even less proof of that. But plenty of proof of increasing the profits and lining the pockets of big business.
    Whats ‘astounding’ is the lack of reason from the right, period.
    The lack of jobs is due to their mismanagement of the nation.

  7. nwcolorist says:

    This letter once again brings out the toxic predjudice of many on the Left towards big business. The Left has equally large lobbyists representing unions and environmental groups, but somehow these are conveniently ignored when they bashing lobbyists.

  8. aislander says:

    Saltsman provided facts. I have had a small business and I know many other business people who cannot pay someone $8.55 to do a job that generates $5 worth of revenue and, therefore, do not hire anyone, rather leaving the job undone or working more than their usual 70 hours per week in order to do it themselves. Now. Provide some facts rather than attacking the source…

  9. aislander says:

    Furthermore, Sumner, Saltsman cites a Ball State University study that concluded that 310,000 part-time jobs have been lost due to the minimum wage. That constitutes “proof” until some lefty impeaches that study with actual facts. Waiting…

  10. PumainTacoma says:

    Last time I checked teenagers can still volunteer and get the same work ethic of discipline and experience. To say you only get this for a paid position is an insult to all the kids out there that volunteer daily, every summer with churches, camps and YMCAs

  11. larsman says:

    P/Tacoma, are you a current volunteer by choice or govt. mandate? Perhaps you actually work for a wage or salary. Was that wage dictated by market conditions or (govt.) lobbyists? Do you like competing in the job market against slave labor? You don’t find slave labor? Is that because the “cash-under-the-table” se hablas have been recruited by unscrupulous minimum wage avoiding employers? Will you or your children work for them? Report them? Or maybe cry blue liberal tears because you haven’t quite mastered “spanglish”? FACT: the minimum wage has destroyed historical entry-level, part-time and seasonal job opportunities, that’s the kick. The punch is found behind Home Despot in the form of “sub-contracted” (read non-union and non-adherent to minimum wage here) se habla slave labor (non benefitos, non insuridad ). Our grandkids will learn to hate us for allowing these conditions.

  12. huffington says:

    On a side note: Michigan has the nations highest unemployment rate. Followed by Nevada, California, Rhode Island, Florida, South Carolina, and Mississippi. California and Rhode Island have state minimum wages higher than the national mandate, but those other states do not. Washington is ranked at 29th.

    Looking at the states list though, it is hard to see any pattern between the states minimum wage and their unemployment rate.

  13. Sumner401 says:

    Saltman provides opinion and conjecture and little else, which is good enough for the fact challenged on the right.
    The writer is a lobbyist, for business, now just who do you think that writer is going to spin for?

    the minimum wage has never been been shown to increase or decrease the number of jobs.
    Yes, it’ always touted as the end of the know universe when the subject comes up but even after the rate goes up, the universe still remains, funny how none of you ever notice that.

    Clearly very few of you have ever made payroll, if you did you would know that while labor is the among the highest portion of cost, it is a fixed cost and easily budgeted for. And if the minimum wage is going to make or break you, you’ve much bigger problems on you hands.

  14. Sumner401 says:

    Huffington, it’s hard to see a pattern because there is no pattern.
    the minimum wage has little to no effect on employment, but it can have an effect on the profits siphoned off to line the pockets of the fat cats.
    Funny how when you get to the bottom of things, it comes down to who is greedy and who isn’t.

  15. aislander says:

    Sumner401 wrote: “…it comes down to who is greedy and who isn’t.”

    …and nobody is greedier than government and its clients. The riff about “…if the minimum wage is going to break you, you’ve much bigger problems…” is an old lefty chestnut that I’ve seen a hundred times. When you’re trying to get a fledgling business off the ground EVERY expense matters.

    Incidentally, the Ball State study was about the MARGINAL effects of the increase in the minimum wage and didn’t address the number of jobs lost below that level…

    Oh, and we’re all holding our breaths waiting for you to back up YOUR assertions with facts….

  16. If another employer was able to pay his/her employees less than I could, that would be unfair to me. When wages are regulated as to their minimum, employee’s wages are removed from the competitiveness equation those businesses use to calculate their prices. Knowing that all the other businesses involved in my competitive circle are bound by the same minimum wage regulation should be comforting to me as a business owner.

    For example, look at how offshore wages has destroyed many American businesses. Has this been fair to American businesses? Absolutely not!

    Remember that old saying, “you get what you pay for.” Or my favorite, “When you pay peanuts, you get monkeys.”

  17. nwcolorist says:

    It would be interesting to know if the defenders of the minimum wage, (fatuous, Polago and Sumner) have ever owned and run a viable business. I have a feeling they haven’t.

  18. Sumner401 says:

    I have owned and operated several business, so you are very very wrong.

  19. Maybe your interests would be better served, nwcolorist, by explaining just how the minimum wage law negatively effects your ability to compete on the open market, rather than challenging the credentials of those whose opinions you dislike.

    I see nothing wrong with a level playing field.

  20. Sumner401 says:

    I have a question for you that think the minimum wage is going to destroy the known universe and is to blame for your own mismanagement,

    How is that trickle down thing working for you?
    Have you figured it out that it doesn’t work and never will because of one thing, greed?

  21. Roncella says:

    If any of you have really owned your own business as you state their is no way you could be for a higher min. wage, period……!!

    Lets be honest even though your posting, lets really be “honest” about it. I have owned my own small business and worked for a large corporation . The min. wage certainly does affect how many employee’s you can hire and keep and train and retain.

    Any business person who has really owned their own business knows this. Its shows up real fast on your P/L statement, under expenses/payroll…..

    Stop with you lame statements your looking foolish…….!!??!!!

  22. Sumner401 says:

    The Ball state study, when read says the minimum wage MAY result in the loss of 550K jobs, SINCE 2007, but the evidence isn’t conclusive. All important FACTS ignored by the ones who are greedy.
    Since 2007 the bush administration shed jobs at a rate faster than we ever have in the history of this nation, 550K, bush could kill that many jobs in an hour.

    As I have stated I have owned and operated my own small business and managed other larger business and the minimum wage is simply that, the minimum wage. You know the man hours you need, you know that wage that you pay each person, it’s simple math….honest.
    If you can’t get over that little tiny ‘hurdle’ then you honestly have no business running a company……honest.
    Not only that but keeping your employees at minimum wage is far more costly than paying more to retain good people, if you had really run your own business you would know that……honest.

    Those that fear paying a decent wage are the greedy ones I mentioned earlier…..honestly.

  23. Let’s face it, Roncella, a business isn’t going to hire any more, or less employees than necessary to conduct their business. That number depends on the amount of business that company does.

    If the minimum wage were reduced, that company isn’t going to acquire a greater market share because all businesses will have the same lower minimum wage requirement.

    Hence, a level playing field.

    But on the other side of that coin, if we all agreed to work for 50 cents per hour, we would get all those outsourced jobs back from China. But then, we wouldn’t be able to pay our bills, would we?

    It’s complicated.

  24. nwcolorist says:

    Sumner, if you have run a successful business, I congratulate you. But, based on your antagonistic comments about business in general, you are an exception to the rule.

    “Decency” is not a valid criteria for setting the prices of wages. Market conditions are what drives the price of wages. When the government tries to set prices and wages, problems follow.”Greed”, when properly used, can (surprise!) be a positive driving force in business.

    Profit is the backbone of any business. When the expenses of a business increase, while income stays the same, profit decreases. That, Polago, is the simple “negative impact” of the minimum wage law.

    I would fear for the prosperity of any company you guys were running.

  25. SO Sumner, you say that you’ve “owned and operated” many businesses? The first ones weren’t successful enough to keep in motion, huh. I can understand that, especially if your biz partners told you of a plan to increase your co.’s profit margin to which you must have replied” NO, we’re making more than enough already and we don’t want to be Greedy, right”? Oh, and Huff, consider Michigan (Detroit) home of Government Motors, Nevada, home of Harry (I can smell the tourists) Reid, California, Nanny Pelosi, and say Sumner,you successful biz owner, you, how ’bout fronting me a mil or two to transport barge fulls of bricks down the Miss. River to rebuild Hurricane/Tornado destroyed buildings along the Gulf? The labor and raw materials are real cheap: Minimun-wage workers could dismantle the shuttered factories they USED to work in, The margin’s high enough so I could even hire—you.

  26. I don’t know what business you’re in, nwcolorist, but if my employee’s wages were adjusted to a new lower minimum wage, my competition would do the same. I would have to lower prices to match my competitor’s and maintain my market share. My overall income would decrease, proportionately, which would result in a net profit gain of zero.

  27. Sumner401 says:

    “a business isn’t going to hire any more, or less employees than necessary to conduct their business. That number depends on the amount of business that company does.”

    BINGO!
    Spoken like a person who has actually ran a business!

  28. Sumner401 says:

    Typical childish response from the ones who know little.
    They are a bit predictable what with the often repeated talking points and attacks on the messenger and a total lack of factual information.
    Oh well, it’s literally what one comes to expect from the ‘cake and eat it too’ crowd.

  29. Pol, Adjusting a minimum downward creates a new minimum, not a mandatory maximum. IOW you don’t have to lower the wage you are paying to the new minimum, you only have to stay at OR above it…that’s why it is called a minimum, pretzel-straightening time…

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