Gee, who could have seen this coming? It’s not as if making minimum wage is designed to help raise a family, nor do any of the hack politicians that are always pushing this ever take into account that employers reduce hours and number of employees accordingly. It’s as if some people never learn from history.
Minimum-wage workers in Connecticut got a 45-cent raise on Jan. 1, the first step in a process that will eventually set their wages at $10.10 an hour.
“It helps a little bit, I guess,” said A. Segui, 20, who works at a Dunkin’ Donuts. She wants to go back to school so she can get a job doing billing at a hospital. But that’s going to have to wait until she can save up some money.
The minimum wage is set to tick up in various states this summer, including California, but the experience of people like Segui presents a sobering reality: Raising wages may not make that much of a difference in workers’ lives. It also might encourage employers to stop hiring or cut back the hours employees work.
Hmm. Perhaps those Democrats exploiting low-wage workers should have considered this. But the fact remains they could care less as long as it buys them votes from the gullible.
The District of Columbia will see its minimum wage go up to $9.50 from $8.25 on July 1. On that date in California, the minimum wage will change to $9 from $8, and will rise again to $10 the following year.
But before those efforts, Connecticut provided an early illustration of what many economists have been saying for years: Raising the minimum wage is not the most effective way to reduce poverty.
It would make more sense to not tax minimum wage earners than to increase their pay, but such an idea would have people calling you a wild-eyed radical. Meanwhile, in another shocking development, hiring has lagged in Connecticut. Imagine that.
Employment growth in Connecticut has lagged behind the nation since December, data show. Nationally, employment grew 0.62% from December through April, while employment in Connecticut fell 0.19% over the same time period.
Much of that drop-off was related to the elimination of 10,900 jobs in January, the month employers had to start paying 45 cents more. In the previous three years, Connecticut had added an average of 4,000 jobs over the same time period.
More job cuts wouldn’t surprise economists. If companies have to pay more for labor, they’ll try to save somewhere else, said Keith Hall, a research fellow at the Mercatus Center at George Mason University.
“Because you’re raising the cost of hiring, you can get this unintended consequence where some of the people on the margin have their hours reduced,” he said.
It’s not an unintended consequence. It’s an entirely predictable result. Every time. And you’ll never guess what else is contributing:
Other factors may be dampening the effect of the minimum-wage increase on workers’ pocketbooks, including the new federal healthcare law, which may be motivating large employers to scale back the number of full-time employees.