Minimum wage madness
Posted by Mitch Kokai at 07:01 AMRoy Cordato has discussed the “cruel hoax” associated with efforts to raise the minimum wage. The latest print version of National Review includes an excellent article from Kevin D. Williamson explaining how — like other Democratic Party policies — the minimum wage “stands between its most loyal constituents and the jobs they need.”
Who are those most loyal constituents? The article’s headline is “Keeping Blacks Poor.”
Here’s one of Williamson’s most compelling arguments, which references young black man named Will who spent three hours selling candy on the New York City subway to clear a $20 profit:
[I]’ts not just that the minimum wage prices so low-productivity workers out of the labor market: It’s that it prevents entry into the labor market in the first place for the most marginal would-be workers. If Will the candy hustler’s real economic output is worth $6.67 an hour, his implied wage on the subway, he’s unemployable with a $7.25 minimum wage. He can sell candy on the subway, but he can’t sell candy for Big Camdy Corp., make connections, learn what it’s like to go to an office every day and have a boss, get references, get promoted, and sign up for the tuition-reimbursement program. And that, not the paltry lost income of a minimum-wage job, is the price he pays. Very few American workers actually earn the minimum wage — about 1 percent, in fact — but the minimum-wage job is a gateway into the labor force for many young workers. The value of your first job isn’t the money you earn from it: It’s your second job, and your third. With the right experience and network, a candyman like Will can do well fr himself. But without that first job, he has a much higher chance of becoming a statistical blip on the long-term unemployment charts than a middle manager at Hershey or a salesman at Cadbury.
» Return to posts for February 08, 2010
» Return to the Locker Room