Nonsequitur: A Minimum Wage Big Mac Attack
September 15, 2014
With the President, Congressional Democrats and unions pushing for a minimum wage hike of more than 100% (from $7.25/hr to $15/hr), it’s probably a good idea to think about the consequences of such a drastic increase. Since a majority of fast food workers start at minimum wage and make an average of $9.04/hr., that industry would be significantly affected.
The Heritage Foundation has released a study on the effects of the suggested wage hike. The findings are summarized in this graphic:
In case you missed that third bar, there will be a 36% decline in work hours. That means employers will be forced to reduce hours for existing workers, either by cutting employee’s work hours or by laying off workers. Most likely, the only new employees added will be minimum wage workers replacing more experienced, more expensive workers.
I think it may be time for a modest minimum wage hike, but the drastic hike suggested by the Left would have strongly negative effects on the economy (and not just the fast food industry).
Whatever the good intentions behind minimum wage laws, what matters are the actual consequences.”