Last week, a minimum wage bill penned by Assemblymember Luis Alejo, whose district includes Gilroy and Watsonville, passed an initial committee with a 5-2 vote.
The bill would increase minimum wage from $8 to $8.25 in 2014 and up to $9.25 in 2017.
Michael Saltsman, research director at the conservative leaning Employment Policies Institute, released the following statement about the potential downfalls of raising the minimum wage:
Assemblymember Alejo’s proposal for an increase in California’s minimum wage to $9.25 will only harm the people he hopes to help. This is particularly true for California’s teens, who already suffer from a worst-in-the-nation 34.6 percent teen unemployment rate, according to a recent Bureau of Labor Statistics analysis. These groups will be the first to feel the negative effects of further increases in the cost to hire and train them.
There's plenty of evidence to support this conclusion. Following the 40 percent federal minimum wage increase between 2007 and 2009, economists at Miami and Trinity Universities found that over 114,000 fewer teenagers had jobs as a direct result. And economists at the Federal Reserve Board and University of California-Irvine confirm that 85 percent of the most credible economic studies on the minimum wage from the last two decades point to job loss following a wage hike.
The Committee on Labor and Employment should remember that good intentions do not necessarily lead to good policy—especially not for the California teens who hope to start climbing the employment ladder in the coming summer months.
Where do you stand on the minimum wage increase issue? Tell us in the comments!