Minimum Wage Hike Doesn’t Help Job Seekers
July 28, 2009 by Miranda Marquit
Filed under Finance
On July 24th, the final phase of a two-year effort to raise the minimum wage to $7.25 an hour took effect. This benchmark has been two years in the making, part of a plan passed in 
Congress to gradually step up the minimum wage. This final phase comes as inflation is low, and so for those already working, this is a great gift.
Job seekers , on the other hand, aren’t so fortunate. At this time, a hike to the minimum wage is probably working against them. Yahoo Finance reports on the impact of minimum wage on job seekers :
A 10% increase in the minimum wage is associated with a 0.9% to 1.1% decline in retail employment and a 0.8% to 1.2% reduction in small-business employment, according to a study published in July 2008 in the Journal of Labor Research.
Since this minimum wage requirement was put into motion years ago, there is no way that lawmakers could have foreseen this particular set of circumstances. But that knowledge doesn’t make the situation any easier for those looking for employment .
Image source: emdot via Flickr
Anyone who is a fan of Peter Schiff can find a pretty good rant by him on this subject at– http://www.europac.net/externalframeset.asp?from=home&id=16714&type=schiff.
Basically hikes in the minimum wage reduce the amount of entry level and low skill jobs…. having the opposite effect of the “do-gooders” intentions. Those politicians trumpeting their support for a “living wage” actually cause higher unemployment for those who need these jobs the most. Remedial courses in economics should be mandatory for all politicians, though I think most of them would flunk out.