Minimum Wage

There's an interesting op-ed in the WSJ today about how the minimum wage negatively impacts high-schoolers and other young people in the workforce. According to the writer,

The main flaw in such thinking is that no one has ever demonstrated that raising the minimum wage reduces poverty. How can that be? Well, partly it's because the vast majority of minimum-wage earners are not, in fact, poor. Of an estimated 87% who are not, many live in households where two or more people work and where combined incomes may be two or three times the poverty level. Then there are young people and teenagers, who are more likely to earn the minimum wage than any other group. A significant number of them have high-income parents.

With the economy booming, more young people are finding work, including summer jobs. But economists have long known that when minimum wages go up, the number of jobs for kids tends to go down.

He goes on to state that

Why pay four kids, an employer may well reason, when for the same, now higher, minimum salary I may be able to attract three adults with a bit more experience?

The implications are especially profound for poor and inner-city black kids. Starting at a disadvantage, they have the most to gain from an introduction to the world of work skills. They also face the most predictably bleak future if they miss this foothold.

I never thought about summer jobs this way. I've been working since I was 15 (13 if you count all the babysitting I did on the weekends!). I first worked at an art studio, where my former elementary school art teacher ran a small summer camp. Then I worked at the Gap for about three years. I've worked at Chili's as a hostess (at the Orlando airport!), in a mail room, as a writing tutor, as a tech intern, and as a cocktail waitress. This is all in addition to my "real" jobs in education. I never thought that all those years of clocking in, making it to work on time, learning new skills quickly, and behaving properly in the workplace made me more successful in my "real" career.

For one of my intro ed classes, I read a book called Beyond College for All: Career Paths for the Forgotten Half by James Rosenbaum. The book discusses how only about 40% or so (I actually think the percentage is in the 30s) of Americans between the ages of 24-35 have college degrees. And yet the policy in many high schools is "College for All," when many students may be better served by entering the workforce as an apprentice or in an entry-level, minimum wage job where they can learn skills and move up through the ranks. I have toyed again and again with going into retail - I always enjoyed working at the Gap, and from sales associate you can become manager, and even a buyer or some other higher-level position, without necessarily having a college degree. Even for those who go to college, learning how to "clock in" is such a useful skill. I dated several guys in college who had never had a job. Never. Never mowed lawns, never worked at the Dairy Queen, never tutored, never got any kind of paycheck.

My parents "encouraged" (ahem) me to work, and at the time I didn't much care for "clocking in," but now I'm so thankful that I learned the value of a dollar through making minimum wage. I used to get up every Sunday morning and clean the Gap at the Fashion Square Mall - get on a ladder, dust the outside sign, vacuum the whole store, dust every shelf, and take out the trash. I worked in a mail room where I got paper cuts. I got blisters on my feet delivering cocktails to wealthy Long Island so-and-sos at The Chalet. Sometimes I'd earn $300 bucks a night, but sometimes I'd come home with $40. There's a great book by Barbara Ehrenreich called Nickeled and Dimed: On (Not) Getting By in America. She works at WalMart, as a maid, at a HoJo's restaurant, etc, and writes about it. I worked those jobs, mostly while living with my parents, but I know that some of those jobs are really hard work. Much harder than filing and sitting at a computer all day, and actually much harder than being on my feet in front of 15 children.

Should we up the minimum wage? The WSJ claims that

And what about the broader "poor" that Senator Ted Kennedy talks about helping with a minimum-wage raise? In truth, his proposed rate of $7.25 an hour won't lift many poor families out of poverty because as many as 64% of the earners in these families already get paid more than $7.25. New research by Joseph Sabia at the University of Georgia and Cornell's Richard Burkhauser indicates that factors other than wages -- such as working fewer hours and supporting large families -- are holding them down.

As painful as it is to think of such people working hard and not getting ahead, at least they are on a payroll and can hope to improve their skills and prospects. It's those unskilled young people, Mr. Burkhauser notes, who are "the most vulnerable part of the population."

And while we can still debate how best to help them, one thing is clear: "What we are doing with a minimum-wage increase," Mr. Burkhauser says, is making sure "that for the folks who don't have the skills to be worth $7.25, they are not going to have a job."

I'm not sure (no citations on the stats), but it is interesting. Oh, and I'm quoting so much of the article because I don't believe that you can access it without full WSJ subscription, but I'll put the link here anyway.

"Labor Lost" (WSJ, June 23rd, 2006)