Wednesday, November 16, 2011

Minimum Wage = Youth Unemployment

I was recently reading this article over at The author is comparing young people across the world to young people in America, in the fact that they are stricken with higher unemployment. I'm not sure if this is just a typo, or an attempt to paint things as worse than they are, but the author claims, in reference to the U.S.:

"For the first time since the 1960s, when women entering the workforce led to a big increase in youth employment, a majority of young people are out of work."

Then they go on to say that young people in the U.S., ages 16-24, the unemployment rate is 18%. Now, I'm sure the author of this article has some college, but he/she was either terrible at math (18% is no where near a majority), trying to spin things to make them look worse, or just a bad editor.

They also assert that republicans played politics with Obamas jobs bill (which was killed by republicans, but in the democratically controlled senate). Even if they did, it's nothing compared to the 18+ jobs bills that the republican controlled house has sent to the senate, which are now collecting dust in the name of playing politics.

Back to the point. In the world of work, youth are the most inexperienced and least educated. Many of them don't have a work ethic due to television and lax parenting, but a job can fix some of that. A minimum wage furthers the hardship on youth, and it should come as no surprise that as minimum wage rose higher, so did youth unemployment.

When a business has the freedom to pay their employees as they see fit taken away (i.e. minimum wage), they have only a few options. They can either raise the cost of their product or service, which drives demand down in most all minimum wage markets. Or they can hire someone with more experience and education in hopes of having the extra experience/education allow this person to be more productive and actually earn the extra money that the business is forced to pay.

Effectively, minimum wage prices out the young and inexperienced/un(der)educated. Yet, young people are the biggest supporters of minimum wage and minimum wage increases. The folks down at OWS were even calling for an $18/hour minimum wage. (Isn't it ironic how obsessed with the economy they are, but how little they understand its workings?)

Minimum wage is hogwash, and should be abolished.

Side note: what happens when you offer occupiers GREAT JOBS (insurance benefits, good salary, 401k, etc...)!?

No comments:

Post a Comment