August 24, 2016
New Jersey Governor Chris Christie is currently deciding whether or not to sign a $15 minimum wage into law, and the Employment Policies Institute today released a new commercial that should help him make his decision. Earlier this year, EPI released an … Continue reading
August 19, 2016
A new study released by the Employment Policies Institute, authored by Dr. Thomas Ahn of the University of Kentucky, finds that Connecticut’s paid sick leave law hasn’t delivered on its proponents’ promise that “everybody benefits.” Instead, the evidence from Connecticut … Continue reading
August 2, 2016
A $12 minimum wage will cost the state of Maine at least 4,000 jobs, but that hasn’t kept proponents in the state from advancing bad arguments to support it. Consider a recent release by the labor union-backed National Employment Law … Continue reading
About the Minimum Wage
The minimum wage is the minimum hourly wage an employer can pay an employee for work. Currently, the federal minimum wage is $7.25 an hour (part of the Fair Labor Standards Act) and some states and cities have raised their minimum wage even higher than that. California and Massachusetts currently have the highest state minimum wages in the country at $10 per hour, and Emeryville, CA, currently has the highest city minimum wage at $14.44 an hour.
Employees that earn the minimum wage tend to be young, and work in businesses that keep a few cents of each sales dollar after expenses. When the minimum wage goes up, these employers are forced to either pass costs on to consumers in the form of higher prices, or cut costs elsewhere–leading to less full-service and more customer self-service. As a result, fewer hours and jobs are available for less-skilled and less-experienced employees.
Minimum wage increases do not help reduce poverty. Award winning research looked at states that raised their minimum wage between 2003 and 2007 and found no evidence to suggest these higher minimum wages reduced poverty rates. While the few employees who earn a wage increase might benefit from a wage hike, those that lose their job are noticeably worse off.
Employees who start at the minimum wage aren’t stuck there. Research found that the majority of employees who start at the minimum wage, move to a higher wage in their first year on the job.