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MINIMUM WAGE: Teens being priced out of jobs

Letter by Michael Saltsman, Washington, D.C. on Nov. 12, 2010 at 4:12 pm | 124 Comments »
November 12, 2010 4:19 pm

Re: “Increase in minimum wage good for struggling families” (Viewpoint, 11-12).

Tsedeye Gebreselassie of the National Employment Law Project appeals to legal reasoning in her defense of Washington’s pending minimum wage increase.

Washington policymakers don’t need a lawyer. They need an economist to explain that yearly wage hikes are contributing to the state’s high unemployment rate among teenagers – averaging 33 percent as of September 2010. That’s the fourth highest in the country.

Washington’s rising minimum wage makes it more expensive for employers to hire less-experienced employees like teens. Customers continue to demand low prices, and as a result employers respond to higher labor costs by cutting staff hours or positions. Over time, they’re forced to turn to more cost-effective alternatives like automation and self-service.

Economists overwhelmingly agree. In a comprehensive survey of two decades of minimum wage research, labor economists David Neumark and William Wascher found that 85 percent of the best studies on the subject pointed to employment loss for less-experienced employees following a minimum wage hike.

Research also shows that most minimum wage workers earn a raise within their first year on the job, due to their own hard work. But they can’t get that raise without experience, and they can’t get experience if they’ve been priced out of the workforce.

(Saltsman is a research fellow with the Employment Policies Institute in Washington, D.C.)

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