A local professor has written about a proposal to link the minimum wage to congressional pay raises. And he provides several reasons why this is not a good idea:
First, when things cost more, people buy less. That’s a fact, just like gravity.
The minimum wage is the price of low-skilled labor. Raising it means employers will buy less and instead buy relatively more skilled labor and machines. Or they might shift low-skilled jobs to cheaper countries.
That’s a bad idea because the second reason to oppose raising the minimum wage is that it stops low-skilled workers from getting skills. A job that pays minimum wage is usually simple or unpleasant manual work. People take these jobs precisely because they lack skills. To get skills, however, they need jobs. Job-related experience and training transform low-skilled employees into high-skilled employees. People shut out of entry-level jobs won’t get that chance if they can’t get hired.
Third, the minimum wage helps the haves, not the have-not’s. It helps skilled employees by stopping people with fewer skills from competing with them on price.
