Wage hikes always cause a spike in the unemployment rate, and this year, with the country in the middle of a recession, businesses are already struggling to make ends meet. The economy will continue to hemorrhage entry level jobs unless legislators stop this summer’s minimum wage hike from happening.
Economists are nearly unanimous in pointing out that unskilled workers bear the brunt of minimum wage hikes. According to a 2007 survey from the American Economic Association at the University of New Hampshire Survey Center, 73 percent of labor economists believe increases in the minimum wage will lead to employment losses, which will fall disproportionately on the least skilled workers.
Teens get hit especially hard by wage hikes. Research from the University of Georgia (2006) found that for every 10 percent increase in the minimum wage, teen employment at small businesses decreased between 4.6 to 9 percent. Last summer’s 12 percent minimum wage hike contributed to a 5 percent drop in teen employment and the losses continued this year. Since Congress began implementing the 2007 wage hike, over 480,000 teen jobs have disappeared across the country.
Ahh, to heck with it - Congress passed it, it must be good!