Stossel: Minimum Wage Hurts Beginners

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Seattle was the first big city to pass a $15 minimum wage.

People there were excited.

“I think it’s pretty awesome since I benefit from it,” one told us. Another added: “I wish it was all over the place, not just Seattle.”

Now, five years after the law passed, the evidence is in: While some workers did earn more, entry-levels jobs decreased.

The politicians never mentioned that when they passed the bill, says Erin Shannon of the Washington Policy Center: “It’s really presented by minimum wage advocates as…a win-win for employers…a win-win for workers.”

She pointed us to a factory that moved hundreds of jobs out of state, and to a store that stopped hiring beginners because of the $15 minimum wage.

“The politicians, in Seattle especially, have no sense whatsoever about what it means to small businesses like us,” the owner of Retrofit Home tells us.

A minimum wage hurts young people who need a first job, say three young people who won a contest organized by Stossel in The Classroom, which provides free videos and lesson plans about free markets to teachers.

Dillon Hodes won the high-school-level video contest. He says a friend who worked at Kroger saw her hours cut as the store implemented a $12 minimum.

“Raising the minimum wage causes increased unemployment,” explains Rigel Noble-Koza, the college-level contest winner.

Stossel says he learned things from Noble-Koza’s video, which noted that Iceland, Norway, Sweden, and Switzerland have no national minimum wage.

The minimum wage “stops us from actually getting a job,” says Esther Rhoads, who won the high school essay contest.

She points out that the earliest advocates of the minimum-wage wanted to price black Americans out of the market.

About 100 years ago, blacks were often paid less but they were more likely to be employed than whites. Rep. Miles Clayton Allgood (D–Ala.) said he hoped the minimum wage would stop “cheap colored labor in competition with white labor.”

“It was meant…to keep the poor and the minorities from getting jobs,” Esther tells Stossel.

The minimum wag also harms young people.

Esther explains: “I’m 14. It’d be very difficult for me to find a job—my labor wouldn’t be worth $15 an hour.”

“If only politicians were as smart as those kids,” Stossel says.

The views expressed in this video are solely those of John Stossel; his independent production company, Stossel Productions; and the people he interviews. The claims and opinions set forth in the video and accompanying text are not necessarily those of Reason.


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