- - Monday, January 7, 2019

Last week, the New York Times published an article titled “The $15 Minimum Wage Is Here. It’s Not Nearly Enough, but It’s a Start.”

The New York Times hasn’t always been clueless when it comes to minimum wage mandates. In 1987, the editorial board declared that “Those at greatest risk from a higher minimum would be young, poor workers, who already face formidable barriers to getting and keeping jobs.”

So why the change of heart? The laws of economics haven’t changed, but politics sure have.

In a candid moment during 2014, SEIU organizer Kendall Fells described the labor union’s unscientific arrival at $15: “Ten dollars was too low and $20 was too high, so we landed at $15.”

Embracing a $15 minimum wage, or the “Fight for $15,” has now become a progressive litmus test — no matter how acidic its impact on employment opportunities may be. An over 100 percent increase in our current federal minimum wage will take away entry-level job opportunities for those that need them most: The less educated and our country’s youth. In spite of this, progressive activists are moving the goalposts even further.

During President Obama’s 2013 State of the Union address, he proclaimed that a $9 minimum wage would be the difference between “scraping by or finally getting ahead.” By 2014, Mr. Obama decided that $10.10 would create “wages we can live on.” One year later, and Democrats coalesced behind Rep. Bobby Scott’s Raise the Wage Act which called for a $12 minimum wage. And in 2017 Bernie Sanders introduced his own Raise the Wage Act in the Senate, this time demanding $15.

And there is no sign of Democrats stopping at $15. In order to normalize the idea of unprecedented wage hikes, labor unions have a history of testing city specific and industry-wide wage mandates. That was the case in Oakland, where starting July 1st, 2019, hotel workers will receive a $20 an hour minimum wage. Similar efforts are underway on the other side of the country. Last October, the Port Authority of New York and New Jersey approved a $19 minimum wage for 40,000 airport workers.

While minimum wage advocates may celebrate their political calculus, the math just doesn’t add up for businesses and their employees.

In New York, the Croghan Adult Day Care Facility — which provides care and housing for people with Alzheimer’s and other disabilities — announced that it will be closing down this month after the state increased its minimum wage to $11.10 at the end of 2018. In Boston, one of the oldest restaurants in the city, Durgin-Park, announced it will soon be shutting down after 191 years in business following the state’s embrace of a $15 minimum wage.

People often overlook that when a business closes or shrinks, it is the employees who miss out on a paycheck. At Facesof15.com, my organization, the Employment Policies Institute, has chronicled dozens of minimum-wage-induced closures.

These establishments offer valuable entry level jobs that can give young people experience that will benefit them later in life. According to a study by economists with the Universities of Virginia and Middle Tennessee State, high-schoolers with part time work experience earned 20 percent higher annual wages 6-9 years after graduation compared to their fellow students who didn’t work.

Even though 2018 saw some of the lowest unemployment rates since 1969 (3.9 percent as of December), the strong labor market is leaving our youth behind. Almost 11 million teenagers between the ages of 16-19 don’t have a job and aren’t seeking one. This represents a near 20-percentage point decline from the turn of the century, when more than half of all teens were in the labor force.

Skeptics may point out that this is because more and more young adults are focusing on their education. However, a Mercatus Center study by economists David Neumark and Cortnie Shupe found that rising minimum wages have been the “predominant factor” in teenagers dropping out of the labor force. This troubling trend complicates problems for teens being left behind by the education system.

Take Virginia, right outside our nation’s capital. The two school districts with the highest dropout rates in 2018 were Richmond City and Lunenburg County, at 20.2 and 15.2 percent respectively. One is urban, one is rural, but they both have the same problem. As the cost of hiring goes up rapidly, businesses turn to automation and more self service, which shrinks job opportunities for those without a high school education. A Virginia state senator’s plans for a 55 percent statewide minimum wage hike will exacerbate their problems in getting a starter job. Nationwide over 1,000 young people drop out of school every day. Their prospects for a future off the dole are equally dim.

Columnists have claimed that the Great Recession led to a “Lost Generation.” Radical minimum wage hikes will only steal opportunities from young people trying to find themselves.

• Richard Berman is the president of Berman and Co., a public relations firm in Washington, D.C.

Copyright © 2022 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.

Click to Read More and View Comments

Click to Hide