According to a new report from the American Action Forum, state minimum wage increases are on course to cost the country 1.8 million jobs without doing much to improve the paychecks of those workers supposedly benefitting from the hikes.
“The full minimum wage increases over the next several years will cost 1.8 million jobs,” wrote the analysts. “When combined with recent previous minimum wage increases in some of the same states, the total loss comes out to 2.6 million jobs.”
The AAF acknowledged that voters who support hiking the minimum wage have their hearts in the right place, but the report suggests that they have a misguided view of how the job market works. Many think that companies are sitting on piles of profit, exploiting unskilled workers for no reason than their own greed. These CEOs might have to forgo a second private plane or cut their Maui vacations down to only three weeks, and that’s a sacrifice the voters can live with.
Unfortunately, that’s not how this works. The vast majority of employers pay their workers in accordance with market demands, and they have no room whatsoever to raise wages across the board. To comply with the minimum wage increases, therefore, they must either slash jobs, raise prices, or shut their doors altogether. In many cases, these options ultimately become one.
For those who manage to hold onto their low-level jobs, the financial impact is mild at best.
“In the end, the additional earnings transferred from the job losers to the job keepers are minimal,” the report concludes. “For each job loss, total wage earnings only rise by $6,900.”
Republicans have an abysmal record of success when it comes to complex economic policies like the minimum wage, and it’s not hard to understand why that is. You need to know a little something to understand why a $15 minimum wage is a bad idea. You need to study some facts and figures. You need to have a basic grasp of the free market and a fundamental understanding of capitalism.
Arguing for a minimum wage hike, on the other hand, is as simple as politics can get. Hey, you fellas want more money? Vote Democrat! Woo-hoo! Look at those evil Republicans, trying to keep you down. They don’t care about you – they only care about the 1%! Fight back, comrades!
We may have to endure quite a bit of economic misery before these lies are exposed.