Obama’s Minimum Wage Job-Killerby Gerri Willis
Last night, the President called for an increase in the minimum wage.
“Tonight, let's declare that, in the wealthiest nation on earth, no one who works fulltime should have to live in poverty -- and raise the federal minimum wage to $9 an hour."
By the way, that's a 14% increase in pay from today's $7/hr.
Now, it's not the first time Obama has called for an increase in the minimum wage, but the difference is this time he will campaign across the country to make it happen.
The truth is, raising the minimum wage could be just about the worst thing he could do for the jobs market. We are already 7 million jobs in the hole, 7 million fewer jobs than when the President took office. Raising the minimum wage means employers whose businesses are struggling will simply get rid of jobs. They will cut workers. According to the Heritage Foundation, the last minimum wage increase eliminated 300,000 jobs,
For a president who says he won't sleep until everybody who wants a job has one, get some NoDoz because there are going to be some sleepless nights.
There are unintended consequences of a higher wage policy, but there is also the fact that the President inaccurately depicts the people on minimum wage. If you surmised from the President's description that minimum wage workers were single mothers balancing a job at McDonald’s and caring for her children, you'd be wrong. Most minimum wage workers aren't adults but people 25 years of age and under, and 60% work part-time.
The true picture of the typical minimum wage worker is a high school or college student with a part-time job, balancing work with the demands of an academic life. Do they deserve a 14% pay hike?
According to the Heritage Foundation, people who are paid minimum wage typically live in households with incomes two or more times over the official poverty level. Non-economists refer to them as mom and dad.
Here's what the President doesn't understand that you probably do: minimum wage jobs are training positions. The employer contributes every bit as much to the worker in terms of training teaching job skills, good work habits, how to meet expectations, as the worker does. That's why these folks aren't getting top dollar. They are newbies.
The job market is full of people performing at different levels and they all don't get paid the same amount of money! That is fair, right and good.
Oh, and by the way, two-thirds of minimum wage workers don't earn minimum wage after a year. They get a raise!
Finally, I believe the President is trying to play on our fears about the economy and the future. Behind his rhetoric is the idea that the private economy isn't up to the task of providing good jobs with solid pay. The government has to kick them in the behind to make it happen.
I disagree. Our workforce isn't dominated by minimum wage jobs. It’s the exception, far from the rule. Just 5.2% of workers are paid the minimum wage, and that's down from 13.4% in 1979.
In a world in which 14 million of us are underemployed or unemployed, the minimum wage is far from the biggest problem facing American workers. We need a strong economy to produce jobs for every level of worker. Let's focus on that and solve it.