Liberal Myth
The U.S. should increase the minimum wage to help poor workers.
The Facts
Minimum wages are a price control that causes higher unemployment among less skilled, workers.
Helping students, not the poor
Few minimum wage workers support families on their own. (See chart)
Among workers making the minimum wage and just above it,
- Over half were teenagers or adults under 25 years old
- A third were enrolled in school
- More than half were voluntary part-time workers
- Only seven percent were heads of poor families
- Their average family income is $45,200
Discouraging employment
Minimum wages harm those they are supposed to help since they:
- Artificially increase the cost of unskilled labor
- Encourage employers to minimize their demand for low-wage employees, either by using more machines or by changing the way that they offer services.
- Creates a surplus of unemployed unskilled workers, further depressing bargaining power.
- Draw young students away from school, and into the labor market prematurely. This causes teenage unemployment to rise (See chart)
Related Heritage research
- Tim Kane, "Minimizing Economic Opportunity by Raising the Minimum Wage," March 4, 2005
- D. Mark Wilson, “Who is Paid the Minimum Wage and Who Would be Affected by a $1.50 per Hour Increase,” June 28, 2001
- D. Mark Wilson, “Increasing the Mandated Minimum Wage: Who Pays the Price?” March 5, 1998
