Wednesday, August 05, 2015

Brookings Institution : A $15-hour minimum wage could harm America’s poorest workers

The Brookings Institution reports:
In job markets where young or less-educated workers already have difficulty finding jobs and gaining important work experience, such mandates will likely make it much harder.

In a city like Washington D.C. where unemployment among those with a high school education or less is at a worrisome 15%, jobless rates will almost certainly rise. Many employers will be very reluctant to pay high wages to workers whose skills – including the ability to speak English, in the case of many immigrants – are so modest. A likely result would be not only increases in unemployment but also drops in formal labor force activity (where workers work or search for legal jobs) and perhaps some growth in undocumented work among immigrants.
Even the liberal Establishment Brookings Institution realizes that those with a marginal productivity below $15 an hour could be hurt by making it illegal to work for less than $15 an hour.