The Minimum Wage Destroys Jobs

Originally Posted by Bradylama

If the prevailing minimum is 5 dollars, and then you suddenly increase that by a dollar, you're looking at 1/5th of the current employees on minimum wage losing their jobs.

Have you ever ever heard of labor demand elasticity? Have you ever considered that it's not 1, so maybe your calculations are too simplistic? If you're going to argue with math, then you have absolutely no credibility if you can't even grasp one of the most basic parts of the equation, and did no research to find out whether your "intuitive" economics makes any real sense. Research in the last decade and a half has confirmed that elasticity in fast-food businesses (most highly effected by any wage hikes) is virtually zero. (Take this recent report, by an institute that held onto the notion of high elasticity longer than most - check their report archives.) The numbers don't add up, so we fall back on emotional arguments or outright falsehoods, like Brady's.

In other words, Brady, your argument here is as much an anachronism as your other fanciful notions. I suppose that you'd dismiss economic research by anyone who doesn't put their faith in a gold standard, though, bless your heart.

RR's analogy was closer than you thought anyway; minimum wage hikes' intended purpose is to narrow the disparity between upper management and the lowest workers, but until directors' salaries are based on corporate profitability (regardless of whether I think that's a good idea), such a roundabout trick as minimum wage is only going to do a half-assed job of it.

Originally Posted by a lurker

I think the libertarian argument that minimum wage will destroy your livelihood and lead to rampant inflation is just ridiculous, but I'm not educated enough in economics to say that a minimum wage hike every single year will have minimal adverse effects

Originally Posted by the earlier link

Washington has the highest minimum wage in the country and was the first state to annually adjust its state minimum wage for cost-of-living increases. The Washington-based Economic Opportunity Institute has found that Washington has out-performed the rest of the country in jobs since the end of the recession in November 2001, and that industries most-heavily affected by the minimum wage have not seen adverse employment impacts (Smith 2003; Watkins 2004; Chapman 2004).

Smith, Jason. 2003. “Working Well in Washington: An Evaluation of the 1998 Minimum Wage Initiative.” Policy Brief. Economic Opportunity Institute. http://eoionline.com/MinimumWage/Brief2003.htm
Waltman, Jerold, Allan McBride, and Nicole Camhout. 1998 “Minimum Wage Increases and the Business Failure Rate.” Journal or Economic Issues. Vol. XXXII, No.1, (March). p.221.
Chapman, Jeff. 2004. “Employment and the Minimum Wage: Evidence from Recent State Labor Market Trends.” Briefing Paper. Washington, D.C.: Economic Policy Institute.

How ya doing, buddy?