By David Flemming
For much of the Minimum Wage Study Committee’s meeting on Oct. 2, proponents of the $15 minimum wage happily downplayed the likely increase in lost jobs and rise in prices that would come as a result of the hike. This is why it was so refreshing to hear one proponent of the $15 minimum, Dr. Beth Ann Maier (VT Chapter of American Academy of Pediatrics), admit that “raising the minimum wage may cause prices to rise (and) maybe some job hours would be lost.”
But, with this admission, we’re left to wonder why then Dr. Maier supports the $15 minimum. She tries to explain: “Maybe many of those lost hours would be the extra hours that workers are spending away from their families just to stay in the same place.”
And now we know why Maier is a doctor and not an economist.
Unfortunately, a higher minimum wage will give some parents a LOT more time with their families — because they will be unemployed.
Much of Maier’s rationale hinges on the theory that Vermont employers will evenly distribute the reduction in hours across the workforce, and pay every low-income worker more for every hour worked. In the real world, this is not the case. If a $15 minimum is implemented, the most productive workers might work less and be paid more per hour worked, but the least productive workers will be let go entirely. Vermont’s Joint Fiscal Office (JFO) estimates that Vermont’s economy will have 2,830 fewer jobs by 2028 if Vermont enacts a $15 minimum wage, while the Heritage Foundation estimates that Vermont could lose as many as 11,000 jobs.
Though it’s nice to think that parents with less hours to work — or no hours to work — would use the opportunity to spend more quality time with their kids, it is more likely that the resulting underemployment and unemployment a minimum wage hike would usher in would hurt rather than help Vermont children.
A 2010 Boston University study analyzing data from 1990-2008 concluded “each one percent increase in unemployment rate correlated with an increase in the number of child maltreatment reports one year later.” They further note, “We’ve observed over the last couple of years just a real level of stress in a large portion of our families, and when we engaged them in conversation quite often it starts off with one of them [losing] their jobs.”
Sadly, raising the minimum wage and decreasing employment would risk creating more frustrated and unemployed parents who might take their anger out on their children.
No doubt there is something to be said for parents who work long hours needing to spend more quality time with children. But given that the alternative is unemployment, and potential child abuse, legislators have another reason to renounce a $15 minimum wage.
David Flemming is a policy analyst for the Ethan Allen Institute. Reprinted with permission from the Ethan Allen Institute Blog.