Tag Archives: minimum wage

Don’t cheer minimum-wage hikes, they’re killing millions of jobs

Source: Investors Business Daily
by staff

“A large number of states and cities are raising their minimum wage this year, part of a wave of recent actions to help low-income workers. Sadly, not only will it not help, it will devastate many of them. Twenty-one states and Washington, D.C., will raise their minimum wage this year, under the misbegotten notion that it will help the poor, in particular struggling minority youth. It won’t. As a new study from the American Action Forum shows, not only will most workers not be better off, they will take a huge hit. Why? Common sense tells you that when you raise the cost of something, anything, less of it will be used or consumed. It’s a fundamental precept of economics. And labor is no different.” (02/12/18)

https://www.investors.com/politics/editorials/minimum-wage-hikes-kill-millions-of-jobs

Freedom and the minimum wage

Source: Future of Freedom Foundation
by Richard M Ebeling

“Most of us both value and take for granted the ability to make decisions about our own lives. When busybodies put their noses and their mouths into our personal affairs, we often say or at least think, ‘Mind your own business.’ Unfortunately, we live in a world in which too frequently government won’t leave us alone, and instead, very actively tries to mind our business for us. Let us briefly look at one such instance in which Uncle Sam puts his nose in other people’s business, that being the legal hourly minimum wage.” (02/12/18)

https://www.fff.org/explore-freedom/article/freedom-minimum-wage/

Why monopsony employer power is virtually irrelevant to the impact of a higher minimum wage on employment

Source: Coyote Blog
by Warren Meyer

“Most of us who took Econ 101 would expect that an increase in the minimum wage would increase unemployment, at least among low-skilled and younger workers most affected by the minimum wage. After all, demand curves slope downwards so that an increase in price of labor should result in a decrease in demand for that labor. … Supporters of the minimum wage, however, argue that these employment effects are exaggerated, because employers have something called monopsony power when hiring low-skill workers. What a monopoly is to customers — it limits choices — a monopsony does to suppliers, in this case the suppliers of labor. The argument is that due to a bargaining power imbalance, employers can hire workers for less than they would be willing to pay in a truly competitive market, gaining the company added savings that increase its profits.” (01/30/18)

http://www.coyoteblog.com/coyote_blog/2018/01/why-monopsony-employer-power-is-virtually-irrelevant-to-the-impact-of-a-higher-minimum-wage-on-employment.html

Wages of awful policy: Minimum wage hikes cause hundreds of busboys to lose jobs at Red Robin

Abigail R. Hall

Source: Independent Institute
by Abigail Hall Blanco

“Red Robin, a popular burger chain, will cut jobs at all 570 of its locations because, chief financial officer Guy Constant said, ‘We need … to address the labor [cost] increases we’ve seen.’ To put it differently, Red Robin is cutting these jobs because of bad government policy: namely, hikes in the minimum wage. On January 1, some 18 states — from Maine to Hawaii — increased their minimum wage. Founded in Seattle but headquartered in Colorado, Red Robin hopes to save some $8 million this year by eliminating bussers from their restaurants. (Bussers, or busboys, clear dirty dishes from tables, set tables, and otherwise assist the wait staff.) According to the New York Post, the company saved some $10 million last year after eliminating ‘expediters,’ who plate food in the kitchen.” (01/17/18)

http://www.independent.org/newsroom/article.asp?id=9240

Minimum wage hikes inflict maximum pain

Source: Reason
by JD Tuccille

“There’s probably no more popular way of patting yourself on the back for doing good while actually harming people than advocating for hiked minimum wage laws that forbid people to accept work that pays below a legally mandated floor. When you raise the price of something above what people are willing to pay, people buy less of it, or else they pass the costs down the line, when possible. This isn’t exactly a revelation; it’s one of the older known economic realities. Unfortunately, there’s always been a certain portion of the population that insists that labor is different and that you really can make people more prosperous by decree. But yet more recent evidence suggests that hiking the price of hiring people works just like raising the cost of everything else.” (01/16/18)

http://reason.com/archives/2018/01/16/minimum-wage-hikes-inflict-maximum-pain

The minimum wage is speeding the robot apocalypse?

Source: Acton Institute
by Rev. Ben Johnson

“Intellectuals like Stephen Hawking and Elon Musk increasingly worry about an apocalyptic world awaiting in the not-too-distant future, when automation replaces all human work (and, in time, artificial intelligence displaces humanity). A new UK study finds the robots may have found an ally: a higher minimum wage. A looming increase in the minimum wage will likely result in a robots replacing a growing number of workers, according to the Institute for Fiscal Studies (IFS). … It is not difficult to understand. Owners hire employees to perform tasks necessary to earn a profit. The higher their wage floor, the more tempting it is to invest in automatons who do not take breaks, go on strike, or cop an attitude with the customers.” (01/09/18)

https://acton.org/publications/transatlantic/2018/01/09/minimum-wage-speeding-robot-apocalypse

A note on minimum wages and monopsony power

Source: Cafe Hayek
by Don Boudreaux

“The existence of monopsony power supplies the only theoretically credible condition under which a minimum wage can possibly improve the well-being of low-skilled workers without harming any of them. Of course, however, claims that monopsony power is in reality rampant enough in the United States to justify minimum-wage legislation are incredible. These claims fail the smell test. But — and here’s the point of this post — to the extent that temporal or geographic pockets monopsony power might arise in reality, once source of such power might well be minimum-wage legislation itself.” (12/06/17)

http://cafehayek.com/2017/12/note-minimum-wage-monopsony-power.html

God knows (but government doesn’t)

Source: Cafe Hayek
by Don Boudreaux

“Of course reality is riddled with individual situations, spread out across locales and time, when wages for some workers could be forced up by an all-knowing god without inflicting harm on any of those workers — that is, with all of the costs of the higher wages paid for by their currently too-powerful employers. Reality is also, no doubt, riddled with individual situations in which wages are, by the same standard of perfection, too high: in such situations god could force down the wages of those currently too-powerful workers and thereby improve the economic welfare of employers and consumers. Indeed, reality is riddled with all manner of imperfections that god could correct in order to increase human welfare. But government isn’t god.” (09/29/17)

http://cafehayek.com/2017/09/god-knows-government-doesnt.html

Minimum wage proponents continue to believe in free lunches

Source: Cafe Hayek
by Don Boudreaux

“[W]hile fewer jobs for low-skilled workers is a chief and especially unfortunate result of minimum wages, it isn’t the only negative result. Many other responses to minimum wages are possible instead of, or along with, reduced employment opportunities. My colleague Dan Klein offers some examples: the extent and difficulty of work duties grows; flexibility in employee scheduling declines; fringe benefits and on-the-job training decrease; lockers, free food, and other amenities for workers are cut; workplace safety, comfort, and amiability decline.” (09/26/17)

http://cafehayek.com/2017/09/minimum-wage-proponents-continue-believe-free-lunches.html

Target to increase its minimum hourly wage to $15 by the end of 2020

Source: Chicago Tribune

“Target Corp. said Monday it is raising the minimum hourly wage for its workers to $11 starting next month and then increasing it to $15 by the end of 2020. The company said the move will help it better recruit and retain top-quality staff and provide a better shopping experience for its customers. The initiative is part of the discounter’s overall strategy, announced earlier this year, to reinvent its business, including remodeling stores, expanding its online services and opening up smaller urban locations.” (09/25/17)

http://www.chicagotribune.com/business/ct-target-minimum-wage-increase-20170925-story.html