Still, it's obvious that there's much more to the labor market than wage levels or the existence of jobs; there are, for example, work hours, job satisfaction, and flexibility, and employers will likely start adjusting these other aspects before they cut workers.
After Seattle raised its minimum wage from just under $10 per hour in 2014 to $13 per hour in 2016, reductions in hours worked were much more striking than the reduction in the job count, as shown in research by the Seattle Minimum Wage Project.
Advocates often claim that the higher minimum wage shifts more bargaining power toward workers.
Well-educated workers are familiar with the idea of trading off lower wages for better working conditions-what economists call a "Compensating differential." A minimum wage prevents lower-skilled workers from doing the same.
Minimum-wage jobs are rarely pleasant, but among those who remain in the labor force, wage increases tend to be fairly rapid, with about two-thirds of workers earning above the minimum wage within a year.
This, again, is not a new idea: H. B. Lees Smith wrote in 1907 that "The enactment of a minimum wage involves the possibility of creating a class prevented by the State from obtaining employment." It bears repeating that no one claims that low-wage jobs are fun, but as the late left-wing economist Joan Robinson put it, "The misery of being exploited by capitalists is nothing compared to the misery of not being exploited at all." Statistics show that unemployment and underemployment are far greater contributors to poverty than low wages.
While workers certainly prefer to be paid more rather than less, the minimum wage violates the "All else equal" assumption on which economists rely, as employers find other ways to reduce labor costs.
https://www.city-journal.org/increasing-minimum-wage
After Seattle raised its minimum wage from just under $10 per hour in 2014 to $13 per hour in 2016, reductions in hours worked were much more striking than the reduction in the job count, as shown in research by the Seattle Minimum Wage Project.
Advocates often claim that the higher minimum wage shifts more bargaining power toward workers.
Well-educated workers are familiar with the idea of trading off lower wages for better working conditions-what economists call a "Compensating differential." A minimum wage prevents lower-skilled workers from doing the same.
Minimum-wage jobs are rarely pleasant, but among those who remain in the labor force, wage increases tend to be fairly rapid, with about two-thirds of workers earning above the minimum wage within a year.
This, again, is not a new idea: H. B. Lees Smith wrote in 1907 that "The enactment of a minimum wage involves the possibility of creating a class prevented by the State from obtaining employment." It bears repeating that no one claims that low-wage jobs are fun, but as the late left-wing economist Joan Robinson put it, "The misery of being exploited by capitalists is nothing compared to the misery of not being exploited at all." Statistics show that unemployment and underemployment are far greater contributors to poverty than low wages.
While workers certainly prefer to be paid more rather than less, the minimum wage violates the "All else equal" assumption on which economists rely, as employers find other ways to reduce labor costs.
https://www.city-journal.org/increasing-minimum-wage
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