Is Minimum Wage A Good Idea - amazonia.fiocruz.br

The result would be straightforward: higher wages, but also the closure of mom-and-pop stores; higher prices on everything from gas-station tacos to day care; a rise in AA, particularly among teenagers; and strain in low-wage, rural economies. That, at least, is the argument being made by many economistsbusinesseslobbying groupsand conservative politicians as the proposal comes under congressional consideration. It is an intuitive one. Democrats are proposing to more than double the wage floor to its highest-ever level, asking tens of thousands of businesses to give large raises to millions of workers.

Make something more expensive, people buy less of it; make the wage floor higher, businesses will buy less low-wage work. Yet minimum wages have IIdea way of screwing with economic intuition, and complicating the simple logic of supply and demand. Although only 2 million workers earn the minimum wage or less today, roughly 23 million workers would get a pay increase if the plan were to become law. In addition, Democrats are pushing for the elimination of the tipped minimum wage. They also want to index the minimum wage to inflation, so that workers would get a raise as prices creep up. The proposal has Goox three major sets of concerns. The first is jobs: Many businesses might not be able to make the pay-hike mandate work without laying off employees or not hiring them in the first place.

Those job losses would be concentrated among the people who want but cannot get anything other than very low-wage jobs in the first place, meaning teenagers and other younger workers, women, Black and Latino Is Minimum Wage A Good Idea, and immigrants. Annie Lowrey: How the low minimum wage helps rich companies. Three decades ago, this was conventional wisdom.

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But not now. A large body of research has upended the old consensus that higher minimum wages necessarily reduce employment. One recent survey, for click, examined minimum-wage hikes at the state level and found essentially no effect on payrolls. The open question is how high is too high, Arindrajit Dube, a co-author of that paper and a professor at UMass Amherst, told me.

He and others contend that it might be higher than you would think. The study he worked on showed that setting the minimum wage at up to 59 percent of average wages has no effect on employment. A separate study of minimum-wage hikes in low-wage areas by researchers at UC Berkeley found that setting the floor as high as 80 percent of average wages has no effect either.

Doubling down on reconciliation

Fifteen dollars an hour is roughly two-thirds of the national average wage, and 80 percent of the average in the lowest-wage states, like Mississippi. Examinations of wage hikes in other countries also suggest that a high minimum wage would not cause major job losses. Low-wage jobs tend to have tons of churn: Workers quit, Wae hired, and leave or get fired frequently. In any given month, one in ten low-wage workers leaves or starts a gig; fast-food restaurants click here annual employee-turnover rates as high as percent.

That means a large share of low-wage workers experiences a spell of unemployment in any given year.

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Raising the minimum wage might extend that period of unemployment, Heidi Shierholz, the former chief economist at the Department of Labor, told me, as competition for the jobs heats up. Annie Lowrey: The underemployment crisis. How about restaurants, which will be asked to cope not only with a shift to a high minimum wage but also with the elimination of the tipped minimum? But the tipped minimum is a terrible policy. It promotes racism, sexism, lookism, and ableism in the workplace. It also allows for wage theft. In many statestipped employees are supposed to be guaranteed an hourly minimum by their employers. But one in six restaurants stiffs its workers of that guaranteea Department of Labor investigation found; five in six violate one wage-and-hour law or another. Getting rid of the tipped minimum would task companies with adjusting their business models. Prices would have Is Minimum Wage A Good Idea increase; pay scales would have to change.

But a number of statesincluding California and Minnesota, do not have a tipped minimum. Their restaurant and hospitality industries still manage to operate just fine. Uncle Sam could push more money into subsidized- or guaranteed-jobs initiatives for teenagers and formerly incarcerated individuals, for instance.]