Sticking it to low-wage workers
John Stossel has a good piece on the minimum wage:
The law of supply and demand works in the labor market, too. If government mandates a higher minimum wage, some workers will get a raise. Some. But something else will happen. Employers will hire fewer low-skilled workers. Others will let some current workers go. Some will choose not to expand their businesses. A few will close altogether. If an employer believes a worker creates only about $5.15 worth of value on the job, he won't pay $7, even if the government demands it.
Only 2.5 percent of all hourly workers make $5.15 an hour (or less; some jobs are exempt from the law), says the Department of Labor. "Minimum wage workers tend to be young."
Few of them stay at the minimum wage for long. As they acquire skills, their productivity rises and they command higher wages. According to a study done for the Bureau of Labor Statistics, "minimum wages have virtually no effect on the careers of most workers."
It's hard to find an upside to a policy that robs so many unskilled workers of the opportunity to gain skills and experience.
