Raising Minimum Wage May Hurt Workers More
- Rachel Greszler from the Heritage Foundation argues that raising the minimum wage could negatively impact low-wage workers and the broader economy.
- She presents a conservative perspective on this contentious issue, suggesting potential harm rather than benefits.
- This viewpoint highlights the ongoing debate on whether increasing wages truly aids the working class.
Recent wage increases, particularly a new minimum wage of $20 per hour for fast-food workers, may have unintended consequences for the very individuals they aim to assist. This trend is not limited to California; similar wage hikes are being observed across the nation. Many workers, including those in large households, often begin their careers in minimum-wage positions but typically do not remain there long, as these wages are insufficient to support a family. A report from the National Bureau of Economic Research highlights a troubling trend: as minimum wages rise, employment losses tend to follow, particularly affecting teenagers, young adults, and less-educated workers. For instance, a study in South Carolina revealed an 8.9% reduction in employment for teens and a 15.5% drop for those without a high school diploma following recent wage hikes. The proposed federal Raise the Wage Act of 2023, which advocates for a $17 minimum wage, could lead to employers incurring costs of approximately $42,000 annually for each full-time employee. Moreover, even workers who retain their jobs may find themselves worse off, as employers might offset increased wage expenses by cutting employee benefits. Research conducted on retail workers in Texas and California indicated that a $1 minimum wage increase could result in an 11.6% decrease in total compensation. Additionally, a $17 minimum wage could significantly raise childcare costs for families in lower-cost states, further complicating the financial landscape for those it intends to help. Ultimately, while the goal of family-supporting wages is crucial, current minimum wage laws may inadvertently hinder employment opportunities for less experienced individuals.