Proposition B Con: Breaking down the minimum wage myths

First, proponents of a minimum wage increase are trying to convince the voting public that raising the minimum wage is going to have a significant beneficial impact on families in poverty and single, working parents. Addressing the issues of poverty and unemployment are much more complicated than simply raising wages. 

In an economy such as ours, there is a reaction to every action taken. According to a study just released by the Save Our State’s Jobs Coalition, these low-wage workers are the very people who will actually be hurt the most by raising the minimum wage. In this case, raising the minimum wage appears likely to reduce the number of jobs available over time, thus making poverty even worse.

The SOS Jobs study, conducted by an economist from Florida State University, found many minimum wage jobs will be lost as a direct result of the wage increase. Among the people losing their jobs are lower skilled workers, who have the least opportunity for new employment. Minority employees also will lose their jobs at a disproportionately higher rate.

Research from Cornell University supports this SOS Jobs conclusion. In the Cornell study, employees without high school diplomas and young black adults lost their jobs four times more often than employees with more education and nonminority heritage.

Second, the vast majority of minimum wage jobs are not held by single parents struggling to support their children. Instead, most minimum wage jobs occur in families with multiple sources of income, which explains why more than half of the impact of Proposition B will go to families with an income greater than $40,000 and nearly a third of the new wages will go to families earning more than $60,000 per year.

Families with lower incomes – those supposedly helped by Proposition B – are the ones most negatively impacted, with nearly a third of the job losses occurring in families with annual incomes of less than $25,000.

For every year the minimum wage increases due to inflation, additional jobs will be lost.

Finally, proponents claim minimum wage workers haven’t had a raise in nearly 10 years. This claim is based upon the mythological assumption that “once a minimum wage worker, always a minimum wage worker.” Nothing could be further from the truth.

Two-thirds of all minimum wage employees get a raise in pay during the first 12 months. Only a very small fraction of minimum wage workers have actually remained at the minimum wage since the last federal adjustment.

As voters consider the minimum wage question in November, please remember that the consequences of such a decision may not be helping those most in need.

Jim Kistler is executive vice president of Associated Industries of Missouri, a business and industry trade association representing more than 1,200 member employers.