Las Vegas Review-Journal Pushes Debunked Claim That Youth Unemployment Is Linked To Minimum Wage Hikes
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The Las Vegas Review-Journal penned an editorial attacking minimum wage in Nevada by claiming that raising the minimum wage hurts youth employment, even though studies have found no conclusive correlation between youth unemployment and minimum wage increases.
An editorial by the Las Vegas Review-Journal discussed the recent announcement by Nevada Labor Commissioner Thoran Towler that Nevada's minimum wage won't change from its current level of $8.25 for workers who don't receive health benefits to push the claim that younger, unskilled workers would be harmed by future increases to minimum wage:
Broadcast newsreaders are in the habit of chirping that any hike in the minimum wage means "Nevada's lowest-paid workers got a raise today!" In reality, younger, unskilled workers can expect to be laid off and replaced with robots and computers, while more than half those searching for their first, entry-level job are plumb out of luck.
By delaying teens' first job experiences, where they prove they can show up on time, take direction and interact with customers, this law limits their future earning potential.
How bad are things? Nationwide, a quarter of youths ages 16 to 19 were employed last year. About 61 percent of Americans between ages 20 and 24 were working. Such lows haven't been seen since World War II. According to the Center for Business and Economic Research at the UNLV, Nevada's youth employment rate was a couple of percentage points higher, at 27 percent and 64 percent. Yes, that means only 27 percent of Nevada kids ages 16 to 19 could find work.
Despite the Review-Journal's assertion, studies have found that there is little evidence to support a link between youth unemployment and a higher minimum wage. In fact, as Heidi Shierholz of the Economic Policy Institute pointed out, unemployment overall, not just specifically for teens, is not massively affected by a minimum wage increase:
While it is true that there is some disagreement among economists about whether increasing the minimum wage increases or decreases employment, there is a consensus on the essential point: the impact of a minimum wage raise on jobs, whether positive or negative, is small. The warnings of massive teen job loss due to minimum wage increases simply do not comport with the evidence.
High unemployment shouldn't be a deterrent to raising the minimum wage. In the states where the minimum wage was increased during a period of high unemployment, the average rate of job creation was almost a half point higher than the national average.
Indeed, states that raised the minimum wage above the federal level have been linked in several studies to faster job growth and more hiring by small businesses compared to states that remain at the federal wage level. Although not noted by the Review-Journal, a recent study by the Economic Policy Institute found that raising the federal minimum wage to $10.10 would cause a $226 million increase in GDP for Nevada's economy and directly affect 165,000 workers in the state.
Clearly, the Review-Journal's fearmongering about potentially raising Nevada's minimum wage is unsubstantiated. If the editorial board was really concerned about youth employment in Nevada, it would champion minimum wage increases, not attack them.