President Obama's push to hike the minimum wage from $7.25 per hour to $9 per hour may sound good to minimum wage earners, but business owners and economic analysts aren't applauding. History shows that mandated minimum wage hikes often lead to massive job loss.
"Tonight, let's declare that in the wealthiest nation on Earth, no one who works full-time should have to live in poverty, and raise the federal minimum wage to $9 an hour. This single step would raise the incomes of millions of working families," Mr. Obama said, during his Tuesday evening speech, according to a report in Breitbart.
But in 2009, when the minimum wage was hiked by more than 10 percent, an estimated 600,000 jobs for the teenaged work force disappeared, Breitbart continued. Federal jobs statistics show about half of the 3.8 million minimum wage workers are below age 25, according to the Breitbart report.
Moreover, history doesn't bear out claims that increases in minimum wage levels bring decreases in poverty rates.
"There is not research supporting the claim that minimum wages reduce the proportion of families living in poverty," said David Neumark, an economics professor with the University of California, according to the Breitbart report.
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