Minimum Wage

That Time When Raising the Minimum Wage Cut the Number of Jobs

Boston Globe provides inadvertent economics lesson.

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Fibonacci Blue, Flickr

The Boston Globe's writeup of a Massachusetts program to given low-income youth summer jobs explains in clear language why increases in the minimum wage that are not tied to overall increases in productivity or profits lead to fewer jobs.

The program provides money for YouthWorks, which pays the wages of 4,400 low-income teens in eligible cities who work for nonprofits or local government agencies in the summer. The Senate originally proposed the same funding amount as last year, $11.5 million. Level-funding actually means 600 fewer positions, though, because of the rise in the state's minimum-wage increase to $10 per hour this year and $11 per hour next year.

Maintaining the number of positions would take $13.34 million. But the compromise budget bill lawmakers filed Wednesday night included $10.2 million for the program, which translates into about 1,000 jobs lost.

The emphasis is in the original, which is taken from Tim Knighton of PJ Media's gloss on the story. Knighton continues:

Those who are fighting for an increased minimum wage ignore the simple economics of running a company. Businesses only have so much money available to pay people. The difference between YouthWorks and private business is that only one gets to vote on how much they have available.

More here.

Reason recently interview George Mason economics professor Don Boudreaux on "The Cruelty of the $15 Minimum Wage," which he says prices the least-skilled, most at-risk workers from entering and staying in the workforce.

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  1. But the compromise budget bill lawmakers filed Wednesday night included $10.2 million for the program, which translates into about 1,000 jobs lost.

    Legislators unwilling to cough up a living wage is what cost those jobs.

    1. Well thank GOD they still qualify for food stamps. From the look of the 2 in the pic, there has been an expansion in that budget.

  2. Group seeking $12 base wage posted jobs paying $10 an hour

    An online ad posted Tuesday by the Maine People’s Alliance indicates new phone canvassers/organizers would be paid $429 every two weeks for working 21.25 hours a week. That works out to $10.09 an hour, considerably less than the $12 minimum wage the alliance is seeking by 2020.

    Mike Tipping, communications director for the people’s alliance, said the job posting’s $429 figure was the result of bad math. The original posting was replaced Thursday with a new listing advertising a wage of $510 biweekly, which is exactly $12 an hour.

    The revised listing wasn’t posted until after the Free Beacon reported on the original, but Tipping said MPA employees always have been paid at least $12 an hour.

    1. Math is Hard!

    2. These people, leftists, are constantly caught doing things like this. Or paying fake protesters to walk union picket lines.

      1. Like the “strikes” at Micky D’s last summer; all SEIU-paid protesters, no workers.

        1. Hey man, those workers had jobs to be at…oh wait….

    3. Mike Tipping, communications director for the people’s alliance, said the job posting’s $429 figure was the result of bad math.

      Well we’ve known for a while now that these mouth breathers were shitty at math. And economics, and logic, and critical thinking, and history, and…

    4. Mike Tipping, communications director for the people’s alliance, said the job posting’s $429 figure was the result of bad math.

      Well we’ve known for a while now that these mouth breathers were shitty at math. And economics, and logic, and critical thinking, and history, and…

    5. The original posting was replaced Thursday with a new listing advertising a wage of $510 biweekly, which is exactly $12 an hour.

      So if their desired law passes, they will presumably pay the exact minimum required by law. That’s a great illustration of something, but I don’t think it’s something that MPA wanted to illustrate.

    6. “We plan to update the job listing by 2020.”

  3. increases in the minimum wage that are not tied to overall increases in productivity or profits

    when the increased wage is tired to increases in productivity or profits, they’re just called “wages”.

  4. “Level-funding actually means 600 fewer positions”

    That terrible republican-controlled Massachusetts legislature strikes again!

    1. It’s a result of having a crazy Republican slash and burn governor.

      The good news is, my phone was smart enough to suggest burn after slash in the above statement. Maybe Apple products can be taught evil.

      1. I thought Apple products were already inherently evil.

        1. I guess they’re inherently a background kind of brooding evil. It takes a little work the products actively evil.

          1. Clearly they are evil enough to make you omit chunks of text.

  5. Look, I think the Globe’s point was simple: The legislature is not being generous enough, just like those corporations who underpay their workers aren’t being generous enough.

    1. I have total confidence that is the conclusion the average Globe reader will take from the story.

  6. So… just fired an employee for yankin’ it in the back yard of the warehouse.

    1. Those masturbation euphemisms…

      1. Wait, that wasn’t really a euphemism.

        1. “back yard” was not referring to a part of the warehouse, rather part of the former employee.

          lrn2euph,noob

    2. So, average Friday then?

      1. Other than he was next to the fence that adjoins an elementary school.

        Moron

        1. Jesus christ, that’s stupid. “Sex offender” is not a tag you want following you around for the rest of your life.

          1. In this case I’d say the best defense is a good fence. “Your honor, the fence is solid and ten feet tall, I didn’t even KNOW there was a school on the other side.” (The noise would give it away though.)

    3. Yeah, if he’s gonna put on a show, at least do it where everyone can see.

      1. Ahem, so nothing to see here…

    4. Also, since your comment reminded me of it and, otherwise, apropos of nothing:


      “Are these your penises?”

      This is a question I never thought I’d have to ask, because I’ve never met anyone with more than one penis, but in this case it was two men taking pictures of their penises, together, at work. They hadn’t been caught in the filter, but had instead printed out the picture using the office printer and had accidentally forgotten to pick it up. One of the guys just nodded quietly, but the other leaned over to look clinically at the photo before he pointed to the penis on the left. “Just this one,” he said. I thanked him for the clarification, because I didn’t know what else to say. His friend looked at him, stunned, but I think it was probably a good lesson for him in picking the quality of people his penis takes pictures with. Standards are important, you guys.

      1. Why would you even print such a thing? Do these people not know about Snapchat?

        1. That’s a “back in the day” story. If those dude’s are still around I’m sure their phones are chock full of dickpics.

      2. dude clinton’d the hell outta that situation. I assume he was promoted?

    5. Really? He couldn’t be bothered to use a bathroom?

      1. Something… something… fresh air

      2. There’s probably a sign in the bathroom that says “no yanking your willy” and he’s a stickler for the rules.

    6. I did some work on a federal facility once and my “minder” drove past one guy and said “Ooooh, he’s nasty!” I asked what that meant and it turned out that he and another man, both married to women, had been caught boofing in one of the warehouses a few years ago. Apparently that doesn’t carry consequences in the federal government.

  7. Lynch is speaking about Dallas.

    We’ll see what she, um, unveils.

    1. Never violence; calm action.

      Calls for gun control.

      Find a path forward together; we are all Americans.

      1. We are all Americans except for those bitter clingers.

        1. Does she ever submit proposed legislation to Congress, or is she too worried it will be called the Lynch Law?

          1. And I assume that her family reunions are called Lynch Mobs?

      2. Calls for gun control.

        This is my shocked face 😐

        Actually I am genuinely surprised it this long for some leftist twit to climb on top of the dead bodies and bloviate about the need for gun control. I guess five dead cops aren’t as sturdy a platform as 50 dead gays.

        1. I think Obama called for gun control in his speech this morning at the NATO meeting.

          1. I haven’t seen his speech, but it wouldn’t surprise me.

            1. Transcript and video here.

              Relevant quote:

              We also know that when people are armed with powerful weapons, unfortunately it makes attacks like these more deadly and more tragic. And in the days ahead, we’re going to have to consider those realities as well.

              1. Figures.

    2. Just need to know if the shootings were gross negligence or merely extreme recklessness.

  8. Businesses only have so much money available to pay people.

    Nuh uh! All they have to do is give up some of their immoral profits! Put people before profits and they can afford to pay a living wage! Damn libertarians licking the corporate boot that holds them down! Apologizing for the rich and for their profits! And you can’t understand why all reality-based people laugh at you! Losers! You’ll never win an election because you’re losers! Haaa ha ha ha ha ha!

    1. And that goes double for non-profit organizations.

  9. But the compromise budget bill lawmakers filed Wednesday night included $10.2 million for the program, which translates into about 1,000 jobs lost.

    They’re no jobs, they’re “paid political positions”. And we could stand to lose a lot more of them.

    1. Look, those workers produce something very useful…votes!

      /adaptation of a Dave Barry joke

  10. The difference between YouthWorks and private business is that only one gets to vote on how much they have available.

    But businesses can just take it out of their EVUL IMMORAL PROFITZ!!!!!111!!!!!! All goodfulthinking people know this. /progtard

  11. Obviously as a libertarian I appreciate the object lesson. But no one who believes in minimum wage hikes is going to take away the correct moral to that story.

    Let me try a few prog conclusions on for size:
    “This is why austerity doesn’t work. It hurts everyone, especially those already disadvantaged!”
    “With a higher minimum wage there was more money being spent by minimum wage workers, so keeping the funding the same was basically a cut! See that Teathuglicans? Your government cuts putting people on the streets!”
    “If this was a company they wouldn’t be limited by a strict budget. Their rich shareholders would lose a couple dollars each without the need to fire anyone.”
    “If that program couldn’t afford to provide people a living wage, it was poorly managed and shouldn’t have existed anyways!”

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