Column of the Day: Walter Williams on the Minimum Wage, and Oprah’s Failure to Cover It Accurately
Williams tried to make it through a recent Oprah show on the topic. He couldn’t; the untruths piled up too quickly:
The show claims that 30 million Americans earn the minimum wage of $5 an hour. Actually, the federal minimum wage is $5.15 an hour, and 17 states mandate a higher minimum wage that approaches $7 an hour. At one point, Oprah did manage to clear up this aspect of the show’s errors.
The U.S. Department of Labor reports: “According to Current Population Survey estimates for 2004, some 73.9 million American workers were paid at hourly rates, representing 59.8 percent of all wage and salary workers. Of those paid by the hour, 520,000 were reported as earning exactly $5.15.”
Workers earning the minimum wage or less tend to be young, single workers between the ages of 16 and 25. Only about two percent of workers over 25 years of age earn minimum wages.
I don’t see why the good professor was so upset. Oprah was only off by a factor of about 60. (/sarcasm)
Continuing:
According to the U.S. Bureau of Labor Statistics: Sixty-three percent of minimum wage workers receive raises within one year of employment, and only 15 percent still earn the minimum wage after three years. Furthermore, only 5.3 percent of minimum wage earners are from households below the official poverty line; forty percent of minimum wage earners live in households with incomes $60,000 and higher; and, over 82 percent of minimum wage earners do not have dependents.
The U.S. Department of Labor also reports that the “proportion of hourly-paid workers earning the prevailing Federal minimum wage or less has trended downward since 1979.”
In fact, if there’s one thing you can get economists across the political spectrum to agree on, it’s how dumb minimum-wage laws are:
Two important surveys of academic economists were reported in two issues of the American Economic Review, May 1979 and May 1992. In one survey, 90 percent, and in the other 80 percent, of economists agreed that increasing the minimum wage causes unemployment among youth and low-skilled workers.
How is it “compassionate” to keep someone unemployed, or worse, to cause additional unemployment, by raising the minimum wage?
