Thursday, July 31, 2014

Does raising the minimum wage raise teen unemployment?

Does raising the minimum wage tend to raise teen unemployment?  Very possibly.  

When wages go down -- typically in the US due to pressuring or eliminating a labor union -- the quality of hires tends to go down.  

When bottom end wages go up that naturally attracts better quality hires -- often read more adult workers.  Since one of the big (phoney) arguments against raising the minimum wage is that it is no big help because it is mostly earned by teenagers living at home -- figure out whether it is a bigger, more critical issue to fret the loss of a few teen jobs, or to pay adults enough to raise a family.

1 comment:

Bob Hertz said...

This is such a hard issue though. For black kids, the teen job is a kind of entry into the world of work. Once again we hit that roadblock of our enormous labor surplus.

Keep up the good work on your blog!