September 10, 2018
A recent study from researchers with U.C. Berkeley’s Institute for Research on Labor and Employment suggests that cities which have implemented a higher minimum wage have seen “no significant negative employment effects.” This is just the latest flawed report from … Continue reading
August 23, 2018
Democratic Socialist candidate for Congress Alexandria Ocasio-Cortez, a rising star on the left, supports nearly doubling the federal minimum wage to $15 an hour. In a visit to her previous employer, she demonstrated why this policy is such a bad … Continue reading
August 3, 2018
Today, the Employment Policies Institute (EPI) launched a new web project featuring the stories of more than six dozen teenagers around the country who’ve been unable to find work for the summer. The stories, collected through Facebook, highlight the difficulties … Continue reading
About the Minimum Wage
The minimum wage is the minimum hourly wage an employer can pay an employee for work. Currently, the federal minimum wage is $7.25 an hour (part of the Fair Labor Standards Act) and some states and cities have raised their minimum wage even higher than that. Washington currently has the highest state minimum wages in the country at $11.50 per hour, and Emeryville, CA, currently has the highest city minimum wage at $15.69 an hour.
Employees that earn the minimum wage tend to be young, and work in businesses that keep a few cents of each sales dollar after expenses. When the minimum wage goes up, these employers are forced to either pass costs on to consumers in the form of higher prices, or cut costs elsewhere–leading to less full-service and more customer self-service. As a result, fewer hours and jobs are available for less-skilled and less-experienced employees.
Minimum wage increases do not help reduce poverty. Award winning research looked at states that raised their minimum wage between 2003 and 2007 and found no evidence to suggest these higher minimum wages reduced poverty rates. A new study from economists at the University of California, Irvine and the National Bureau of Economic Research find that over the past 30 years, increases in the minimum wage have not reduced poverty rates in disadvantaged neighborhoods. While the few employees who earn a wage increase might benefit from a wage hike, those that lose their job are noticeably worse off.
Employees who start at the minimum wage aren’t stuck there. Research found that the majority of employees who start at the minimum wage, move to a higher wage in their first year on the job.