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States That Raised Minimum Wage See No Slow-Down In Job Growth
An anonymous reader writes: The U.S. Department of Labor has released data that some proponents of raising minimum wage are touting as evidence that higher minimum wage promotes job growth. While the data doesn't actually establish cause and effect, it does "run counter to a Congressional Budget Office report in February that said raising the minimum wage to $10.10 an hour, as the White House supports, would cost 500,000 jobs." The data shows that the 13 states that raised their minimum wages in January added jobs at a faster rate than those that didn't. Other factors likely contributed to this outcome, but some economists are simply relieved that the higher wage factor didn't have a dramatically negative effect in general.
If you read the rest of the summary, they do make the note that while they can't say that that growth is the result of increasing the minimum wage, it doesn't negatively affect it either.
I don't care if I'm wrong. I only care about everyone obtaining something from the discussion.
Moving to the state whose laws work best for you may work for people who can move, but I expect the people affected by these laws are pretty closely representative of the set of people who can't move.
Even when people are supposedly more mobile, moving is a big thing for most people so they do not do it.
Here in the UK we had a 50% tax rate imposed on the very richest a few years ago. There were lots of stories about how this was going to drive away people who were successful abroad but in the end it made very little difference because while these sort of exceeding rich people might threaten to take their family somewhere else, but then when they talk to their wife and she refuses to move more than a 20 minute drive from her family and refuses to move the kids out of school and away from their friends.
A few years ago I wanted to move to the states as there were few companies that I could have worked for that might have appreciated a few niche skills I had picked up in their field. Although I would have been a ton financially better off in the states and we could have bought a much bigger house to start a family in than the 3 bedroom London house we have now, my wife would not have moved that far away from the family support. I could have explained how the US tax code would have benefited us until I was blue in the face but she simple wouldn't have cared enough to pay attention.
The idea that people will move is just a scare story that the rich use to try and maintain the ability to pay less in taxes or employers use to justify being able to pay as little in wages as possible.
I dont read
States with the healthiest job situations were the first to increase minimum wage.
Inconceivable.
Well, it should be noted that only 5 of the states that raised the minimum wage this year have a Gross State Product per person above the national average (Connecticut, New York, New Jersey, Washington, Colorado). The other 8 have below average economies, but are still gaining jobs at a faster rate. Also if you look at the job growth in 2013, these 13 states may have outperformed the average by 0.065% but they are on track to beat the average by 0.3554% this year.
So it looks like these states do not have the healthiest job situations, but still performed better than those who did not raise the minimum wage (by this ridiculous metric that is).
A better metric is comparing how job growth is growing or stalling. The four states with the highest minimum wages are California, D.C., Oregon, and Washington, who all have minimum wages about $9 per hour. Of those four areas, job growth has slowed by 27% on average year over year (comparing June 2013 - May 2014 to June 2012 - May 2013). If you look at the four states with the lowest minimum wage (Arkansas, Georgia, Minnesota, Wyoming), their job growth has grown by 26% on average year over year. So if you want to compare the trend of job growth increasing or decreasing, it looks like raising the minimum wage does hurt significantly.
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-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
Are you suggesting that there's a huge amount of US workers just waiting to pick fruit and plant pine trees?
I would say for for a thousand bucks an hour, you'd have people lined up around the bloc to pick fruit and plant pine trees. (1000$/hr is a silly high wage, but it makes a point that higher wages will drive workers to a job)
The problem is that with the glut of ultra-cheap labor, the wages for picking fruit and planting pine trees has not increased enough to drive workers to these jobs. When a business utilizes the ultra-cheap labor, the only way for other businesses to match their competitor's prices is to also utilize the ultra-cheap labor. Businesses following the rules will struggle to get by and possibly close down - being unable to cut costs as much as the businesses that aren't playing by the rules.
Unless the government steps in and severely punishes the use of illegal immigrant labor, the problem will persist.