Since Congress has heeded the warnings of the job-killing effects of a federal $15 minimum wage, unions and other activists are pushing the “Fight for $15” agenda at the state level. The latest target is Nebraska, where activists have submitted signatures to certify a measure that would raise the state’s minimum wage from $9 per hour to $15 by 2026, and increase it annually based on inflation.
Economists have long studied the harmful effects of raising mandated minimum wages, including employment loss and restaurant closure, while having limited effects on alleviating poverty. A survey of American economists conducted earlier this year found 62% agreed a $15 minimum wage was too high, citing concerns about inflation, business survival, and employment loss.
The story is the same for Nebraska, should the proposed measure become law. State-level analysis by economists at Miami and Trinity Universities estimated a $15 minimum wage would cost the state over 18,600 jobs – roughly one in ten of all those affected by the increase. The economists also estimate such an increase would cost employers in the state more than $767 million due to the rising wage bill.
This study, which uses employment levels and other assumptions from the nonpartisan Congressional Budget Office, breaks down the effects by demographic for the Cornhusker State.
Raising the wage to $15 would have distinct negative impacts on teens and female employees, and employees in restaurants and bars, which characteristically employ the majority of minimum wage employees.
Teenage workers will experience more than half of total job losses – with nearly one in 3 teenagers that are affected by the increase losing their jobs instead. Nearly 70% of Nebraska’s lost jobs will be for workers under the age of 24.
Nebraska Job Loss by Age due to a $15 Minimum Wage
|Age||Jobs Lost||Percent of Total|
Women will also feel the majority of effects: two-thirds of all jobs lost will be those held by women.
Nebraska Job Loss by Sex due to a $15 Minimum Wage
|Sex||Jobs Lost||Percent of Total|
Similar to the impact on a nationwide scale, workers in the hospitality industry would feel the effects of a $15 minimum wage most acutely. Nearly 40% of all jobs lost will be in Nebraska’s restaurants and bars.
Nebraska Job Loss by Industry due to a $15 Minimum Wage
|Industry||Jobs Lost||Percent of Total|
|Restaurants and Bars||9,752||52.32%|
|Education & Health Care||2,349||12.60%|
|Prof/Scientific, Mgmt, Admin & Waste||493||2.64%|
|Transport/Warehousing & Utilities||163||0.87%|
|Finance & Real Estate||196||1.05%|
|Agri, Forestry, Fishing, Hunting & Mining||297||1.60%|
In 2014, Nebraska voters approved a ballot measure to raise the state minimum wage from $7.25 per hour to the current rate of $9 per hour. If certified, this new hike would spell out significant costs for businesses and their employees.