Take Three: Raising the Minimum Wage Myths

by admin on February 22, 2013 · 10 comments

Chief Economist Jennifer Hunt

Chief Economist Jennifer Hunt

The president’s plan to raise the federal minimum wage will benefit 15 million American workers, and have a positive effect on the economy. Still, there are some common myths about raising the minimum wage. We checked in with our Chief Economist Jennifer Hunt on the following three myths:

Myth: Raising the minimum wage reduces employment.
False. Minimum wage increases have little or no adverse effect on employment as shown in independent studies from economists across the country. Additionally, a recent letter by leading economists including Lawrence Katz, Richard Freeman, Joseph Stiglitz and Laura Tyson points out that “[i]n recent years there have been important developments in the academic literature on the effect of increases in the minimum wage on employment, with the weight of evidence now showing that increases in the minimum wage have had little or no negative effect on the employment of minimum wage workers, even during times of weakness in the labor market.

Myth: Only part-time workers are paid the minimum wage.
False. 53% of all minimum wage earners are full-time workers.

Myth: Raising the minimum wage will negatively affect teen employment.
False. 89% of those earning the minimum wage are 20 years of age or older, and studies have shown that minimum wage increases have had little or no adverse effect on teen employment.

For more information about the federal minimum wage, visit: http://www.dol.gov/minimumwage.

***Note: The data analysis comes from the White House Council of Economic Advisors.

{ 10 comments… read them below or add one }

1 Jerry Foley February 23, 2013 at 3:58 pm

Excuse but right now I would take a job no matter what the pay or hours. However it would be nice if it was not to far from my home.

2 John A Galinac February 23, 2013 at 6:27 pm

Workers at Motion Pictutre Theatres should earned time and one-half after 40 Hours.
End the exemption for those workers who are popping or selling popcorn.

3 Didar February 23, 2013 at 11:42 pm

Raising minimum wages could adversely effect the ability to recruit an inexperienced talents, which might in other way, effect the employment rate, I thought. However, minimum salary should always be adjusted based on expenses of minimum living standards.

4 Karla Jordan February 24, 2013 at 8:53 pm

Employers are indecent to not pay a man a wage that pays their bills. Support the passage of legislation of $9.00 an hour. Hillary Clinton would have had the minimum wagers in the soup lines starving because the moment you get a raise..the company would lay off the entire crew and rehire at the minimum wage level to cut company expenses or send the job overseas to get their products made with $2.00 hour labor in China/Japan/India/ or Mexico!! Give us our pay to cover rent,utilities, food, auto ins, health ins, etc…and recreation.
Support my petition to the congress/senate.
Go to my site http://www.fightforlivingwages.org
Thanks for your support

5 Bertha Saucedo February 25, 2013 at 8:41 am

That is still not sufficient help for the economy, because everything else will increase (food, gas, merchandise, services). The minimum wage earners will be in the same shape.

6 E. Gaither February 25, 2013 at 8:49 am

The first ‘myth’ listed:
In all due respect, this article is quoting an economist who is quoting 4 or 5 other economists or statisticians who are commenting on research they say says the minimum wage being raised will or will not have a certain effect?
When did this ‘research’ occur, and who published it and where is it available for reading?
What are the qualifications of these commenters and ‘researchists?’
This article seems to promote an agenda of support for the President’s proposal to raise the minimum wage, which is certain, after all, all the federal agencies answer to the President and are expected to support the President’s platform, whatever it be. Who wants to get fired that holds down a federal job?

The second ‘myth’ listed:
Who ‘uncovered’ these myths?
No one I have questioned believes that ‘only part time’ workers are paid the minimum wage?
The response to this ‘myth’ quotes statistics from an unidentified source and uses a statistic of 53% of full-time workers making the minimum wage as proof that not only all part-time workers make the minimum wage?

The third myth listed:
The question should be what “studies’ are being summarized here? Who did the studies, when, and were they published.
How ‘little’ is the little adverse effect raising the minimum wage would be on some teenagers and how many of them?
The better issue to answer might be whether a raise in the minimum wage would improve the dismal employment rate of teenagers?
Please advise why someone needs to give proof they are ‘sentient?’ Is it their
‘feeling’ of the color of a typical spring leaf?

7 Aryn Gilenson February 25, 2013 at 9:02 am

What about all of the Americans that make above miumim wage? They are the ones that are going to suffer and realistically, you are not benefitting the minimum wage workers either. If you raise the federal minimum wage, inflation increases to compensate. So the little bit more money that is being earned is also being paid out to compensate by higher prices. The ones who suffer are the millions of Americans who make above minimum wage. Those workers at best get a few cents increase for cost of living, if they even get that. Those few cents may mean a few dollars more at the end of the year (if they are part of the lucky ones who actually get a cost of living increase), which may mean they can afford a few extra gallons of gas, if those prices do not sky rocket as well. My question is: Who really benefits from this great plan? I know it is not the PEOPLE.

8 Char Coburn February 25, 2013 at 11:57 am

I would ask how many of those economists have been out in the real world? Consider this… which earners will be hit the hardest when the price of bread, milk, pasta, rice, etc., increases by the same percentage, if not more, than the increase in pay. Does the word “INFLATION” ring a bell? Why do you think prices are what they are today? When there is no increase in productivity, the raise in pay is counterproductive. Perhaps you should ask employers if they will hire more if the wage goes up? Perhaps you should ask teens if they are employed in any greater numbers..

9 FRANKIE LONG February 27, 2013 at 11:16 am

I DO NOT FEEL THE MINIMUM WAGES SHOULD BE INCREASED, BECAUSE IT ONLY INCREASES PRICES SO RETAILERS CAN PAY THIER EMPLOYEES, WITH OUT HURTING THEIR PROFIT MARGINS. AS A SINGLE PARENT WITH NO CHILD SUPPORT I HAVE TO WORK MORE THAN ONE JOB TO MAKE ENDS COME CLOSE. WHEN MY EMPLOYERS HAVE TO INCREASE EVERYONE’S SALARY THEY THEN MUST USE LESS PEOPLE AND CUT HOURS, SO I WIND UP WITH LESS MONEY THAN BEFORE THE INCREASE. PEOPLE WHO HAVE BEEN THEIR LONGER CAN NOT RECICVE HARD EARNED RAISES BECAUSE OF THE STRAIN IT PUTS ON THE EMPLOYER TO PAY EVERYONE. PLEASE LEAVE WELL ENOUGH ALONE. THIS WILL NOT INCREASE SPENDING BECAUSE PEOPLE WILL HAVE LESS WORKING HOURS THER FORE THEY ARE GOING TO DRIVE LESS AND SHOP LESS AND THEN THEY WILL DEPEND ON GOVERNMENT ASSISTANCE MORE. I AM TELLING THIS TO YOU FROM THE POINT OF VIEW FROM A LOW INCOME HOUSEHOLD. THINGS ARE ALREDY TIGHT PLEASE DO NOT MAKE THEM WORSE.

10 Chase May 8, 2014 at 10:59 am

Wouldn’t raising the minimum wage actually not raise prices because the prices of products and services in the economy are already adjusted to inflation so wouldn’t raising the wage just serve to help consumers have more purchasing power. I mean if workers now under the minimum wage are making less than when the minimum wage was first established then isn’t it only fair that the wages are raised. I mean if prices are going up because of inflation and wages are stagnating then won’t the economy remain in a state of recession due to less money flowing in the economy and forcing people to spend more on credit due to not making enough money for all things necessary such as food and leisure which boosts the economy.

Leave a Comment

Previous post:

Next post: