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EKINS: Polling the real-world effect of a minimum-wage hike

Americans recoil when they learn higher pay means fewer jobs

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President Obama wants to "give America a raise." He's raising the minimum wage for federal contractors to $10.10 an hour and is urging Congress to raise the federal minimum wage from $7.25 to $10.10.

Politico also reports, "the Obama administration wants to make raising the federal minimum wage a centerpiece of Democrats' 2014 midterm election efforts." They hope the national push and planned ballot initiatives in several states will mobilize key Democratic-leaning constituencies that might not normally turn out in non-presidential elections.

Advocates for raising the minimum wage believe this is a slam-dunk issue for them. First, they are equipped with numerous polls finding what appears to be overwhelming support.

For example, Gallup recently found 76 percent favor raising the minimum wage, while only 22 percent oppose it. A recent Reason-Rupe poll found 72 percent of Americans in favor of increasing the minimum wage to $10.10 per hour, including 53 percent of Republicans, 72 percent of independents, and 87 percent of Democrats.

Many economists, however, are far from convinced that raising the minimum wage is the best way to improve prospects for the poor. The Wall Street Journal reported, "Most economists also took a dim view on raising the federal minimum wage to above $10 an hour from its current $7.25.

The Journal survey found 54 percent of the economists who responded were against the idea, 28 percent for it, and 18 percent thought it would have no meaningful impact on workers or the economy."

In their meta-analysis of more than 100 studies, economists David Neumark and William Wascher concluded that "the minimum wage leads to economic distortions and often has unintended adverse consequences for the employment opportunities of low-skilled workers."

Harvard University economist Greg Mankiw likened those who want to move ahead with a minimum wage hike despite the unsettled debate to a "physician who prescribes a medicine based on a few studies that find no side effects while ignoring others that report debilitating effects."

So why does poll after poll show the public is eager to hike the minimum wage? It turns out most Americans don't agree with or, more likely, may not know that many economists are concerned about job losses that could accompany a wage hike.

In fact, 58 percent of Americans told Reason-Rupe that raising the minimum wage would actually increase the number of jobs available (23 percent) or make no difference in the number of jobs available (35 percent).

When asked if they would support an increase to the minimum wage if it caused layoffs or resulted in fewer workers being hired, 57 percent of Americans said they'd oppose raising the minimum wage.

Opposition to raising the minimum wage suddenly cut across party lines, with 68 percent of Republicans, 53 percent of independents and even 50 percent of Democrats opposed to increasing the minimum wage. Just 38 percent of those surveyed said they'd support raising the minimum wage if it would result in job losses.

When fewer jobs or layoffs were mentioned as possible outcomes, support for raising the minimum wage fell from 72 percent to 38 percent in the Reason-Rupe poll.

Politicians should interpret the public support found in most polls for raising the minimum wage for what it is: In the absence of real world costs or trade-offs, Americans understandably want low-wage jobs to pay more and for the poor to make more money.

However, almost everything Congress does comes with consequences and trade-offs, and the minimum wage is no different. When confronted with these potential trade-offs, the public's support for raising the minimum wage isn't nearly as high as we've been hearing.

Emily Ekins is director of polling at Reason Foundation.

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