According to a new study by the George Soros-funded Center for Economic Policy and Research, minimum wage should be $21.72 an hour to keep up with the increase of worker productivity.
Highlighting that study, The Huffington Post bemoaned President Barack Obama’s call for a higher minimum wage as a “far cry from what workers really deserve,” in a Feb. 13 blog post.
What HuffPo, the Center for Economic Policy, and even Obama failed to consider in their calls for a higher minimum wage is how these increases affect the poor.
James Sherk, Senior Policy Analyst in Labor Economics for The Heritage Foundation, responded to Obama’s State of the Union call for raising minimum wage to $9-an-hour. Obama said in his speech that “no one who works full-time should have to live in poverty,” so the minimum wage should be increased. But Sherk pointed out there is “no correlation between higher minimum wage and lower poverty.”
He continued with three facts about minimum wage that is not considered while pushing a minimum wage hike. “First, relatively few minimum wage workers are poor,” he wrote. Many of these workers are high school and college students who are working part time and not supporting themselves or a family on their income.
Sherk also pointed out that “higher minimum wages cost some workers their jobs” and makes “entry-level positions harder to find.” And lastly, and something the left should pay more attention to, is that raises in the minimum wage “claws back raises” in welfare aid received from the government.
In 2009, The Wall Street Journal noted in the Review & Outlook section, that “the minimum wage hike has driven the wages of teen employees down to $0.00” by taking away their jobs. Citing a prediction by UC-Irvine economist David Neumark, who warned the 70-cent-an-hour increase would cost 300,000 jobs, WSJ wrote that teen joblessness was up. “Some 330,000 teen jobs have vanished in two months.”