Anorak

Anorak | Sorry Folks, Raising The Minimum Wage Does Increase Unemployment

Sorry Folks, Raising The Minimum Wage Does Increase Unemployment

by | 19th, February 2014

OK, so this evidence is from the US but it is pretty conclusive:

minimum wage

 

The Congressional Budget Office has cranked through the numbers for the proposed rise in the US minimum wage and it appears that it will put 500,000 people out of work .

Once fully implemented in the second half of 2016, the $10.10 option would reduce total employment by about 500,000 workers, or 0.3 percent, CBO projects. As with any such estimates, however, the actual losses could be smaller or larger; in CBO’s assessment, there is about a two-thirds chance that the effect would be in the range between a very slight reduction in employment and a reduction in employment of 1.0 million workers.

….
The increased earnings for low-wage workers resulting from the higher minimum wage would total $31 billion, by CBO’s estimate. However, those earnings would not go only to low-income families, because many low-wage workers are not members of low-income families. Just 19 percent of the $31 billion would accrue to families with earnings below the poverty threshold, whereas 29 percent would accrue to families earning more than three times the poverty threshold, CBO estimates. Moreover, the increased earnings for some workers would be accompanied by reductions in real (inflation-adjusted) income for the people who became jobless because of the minimum-wage increase, for business owners, and

You have already read 1 premium article for free today
Access immediately the premium content with Multipass

Or come back tomorrow



Posted: 19th, February 2014 | In: Money Comment | Follow the Comments on our RSS feed: RSS 2.0 | TrackBack | Permalink