May 11, 2011

Walter Williams on New Minimum Wage Study: Black Males Hit Hardest

Filed under: Economy,Positivity,Taxes & Government — Tom @ 9:30 am

Professor “Black by Popular Demand” comments on a new study documenting minimum wage laws’ disproportionate impact on minorities:

Their study demonstrates that increases in the minimum wage at both the state and federal level are partially to blame for the crisis in employment for minority young adults.

Their study focuses on 16-to-24-year-old male high school dropouts, understandably a relatively inexperienced group of labor market participants.

… Among the white males, the authors find that “each 10% increase in a state or federal minimum wage has decreased employment by 2.5%; for Hispanic males, the figure is 1.2%.

“But among black males in this group, each 10% increase in the minimum wage decreased employment by 6.5%.”

Racers (those who believe that race and racism explain almost everything, when they explain almost nothing) would of course contend that racism is the primary factor in this. As usual, they’re wrong. Williams elaborates:

Why do young black males suffer unequal harm from minimum wage increases? Even and Macpherson say that they’re more likely to be employed in low-skilled jobs in eating and drinking establishments.

These are businesses with narrow profit margins and are more adversely affected by increases in minimum wage increases.

… The best way to sabotage chances for upward mobility of a youngster from a single-parent household, who resides in a violent slum and has attended poor-quality schools is to make it unprofitable for any employer to hire him.

The way to accomplish that is to mandate an employer to pay such a person a wage that exceeds his skill level.

… Minimum wage laws have massive political support, including that of black politicians. That means that many young black males will remain a part of America’s permanent underclass with crime, drugs and prison as their future.

Meanwhile, these same politicians continue to portrary themselves as the heroes of the underclass, when they really are doing is working to keep the underclass right where they are.

The press release accompanying the underlying study at the Employment Policy Institute says it best:

Minimum wage increases remain politically popular, which means they’ll continue to be debated at the state and federal level for years to come. But the debate on the employment consequences of the minimum wage has been settled conclusively, and this research proves that those consequences are felt most by young black males.

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