Fallout from min. wage increase decisions hitting cities like Seattle and SF already

[DonLever]

There are many countries in the world with NO minimum wages. Surprising 7 of them are in the European Union.

There are seven European Union (E.U.) countries in which no minimum wage is mandated (Austria, Cyprus, Denmark, Finland, Germany, Italy, and Sweden). If we compare the levels of unemployment in these countries with E.U. countries that impose a minimum wage, the results are clear.

A minimum wage leads to higher levels of unemployment. In the 21 countries with a minimum wage, the average country has an unemployment rate of 11.8%. Whereas, the average unemployment rate in the seven countries without mandated minimum wages is about one third lower — at 7.9%.

This point is even more pronounced when we look at rates of unemployment among the E.U.’s youth — defined as those younger than 25 years of age (see the accompanying chart).

In the twenty-one E.U. countries where there are minimum wage laws, 27.7% of the youth demographic — more than one in four young adults — was unemployed in 2012. This is considerably higher than the youth unemployment rate in the seven E.U. countries without minimum wage laws

— 19.5% in 2012 — a gap that has only widened since the Lehman Brothers collapse in 2008.

So, minimum wage laws — while advertised under the banner of social justice — do not live up to the claims made by those who tout them. They do not lift low wage earners to a so-called “social minimum”.

Indeed, minimum wage laws — imposed at the levels employed in Europe — push a considerable number of people into unemployment. And, unless those newly unemployed qualify for government assistance (read: welfare), they will sink below, or further below, the social minimum.

As Nobelist Milton Friedman correctly quipped, “A minimum wage law is, in reality, a law that makes it illegal for an employer to hire a person with limited skills.”

Source:

http://www.cato.org/publications/commentary/let-data-speak-truth-behind-minimum-wage-laws

Countries like Germany, Sweden, Italy, Denmark, and Finland have high standards of living. Do people work for slave wages there?

Update: Germany has introduced a minimum wage this year.

[Mr. Ambien]

There are many countries in the world with NO minimum wages. Surprising 7 of them are in the European Union.

Source:

http://www.cato.org/publications/commentary/let-data-speak-truth-behind-minimum-wage-laws

Countries like Germany, Sweden, Italy, Denmark, and Finland have high standards of living. Do people work for slave wages there?

Update: Germany has introduced a minimum wage this year.

About as necessary and required as a 27th amendment to the US Constitution declaring the US a free country.

But be careful, unless you cite CNN or some capitalist hating drivel like Alternet or some crap, they will drench this thread in tears about your source.

[KoreanHockeyFan]

OP article from Fox News

/thread.

[Lockout Casualty]

There are many countries in the world with NO minimum wages. Surprising 7 of them are in the European Union.

Source:

http://www.cato.org/publications/commentary/let-data-speak-truth-behind-minimum-wage-laws

Countries like Germany, Sweden, Italy, Denmark, and Finland have high standards of living. Do people work for slave wages there?

Update: Germany has introduced a minimum wage this year.

Sweden, Denmark, Finland also all have union participation rates nearing 70%. I wouldn't rule out that free movement among EU states forces nations without a minimum wage to at least have an unofficial floor at some reasonable point. There are a lot of factors to consider when comparing countries with and without a minimum wage. What are the college rates between the countries? What are their poverty levels?

I do like their high union participation rate though.

Anyway, a minimum wage does not actually harm employment in practice. Regarding US:

Abstract

Card and Krueger's meta-analysis of the employment effects of minimum wages challenged existing theory. Unfortunately, their meta-analysis confused publication selection with the absence of a genuine empirical effect. We apply recently developed meta-analysis methods to 64 US minimum-wage studies and corroborate that Card and Krueger's findings were nevertheless correct. The minimum-wage effects literature is contaminated by publication selection bias, which we estimate to be slightly larger than the average reported minimum-wage effect. Once this publication selection is corrected, little or no evidence of a negative association between minimum wages and employment remains.

http://onlinelibrary.wiley.com/doi/10.1111/j.1467-8543.2009.00723.x/abstract

These estimates suggest no detectable employment losses from the kind of minimum wage increases we have seen in the United States. Our analysis highlights the importance of accounting for such heterogeneity in future work on this topic.

https://escholarship.org/uc/item/86w5m90m#page-18

And UK:

Conclusion

6.137 There have been three phases in the Low Pay Commission’s approach to recommending the

adult rate since the NMW was introduced in 1999: initial caution (1999-2001); increases

above average earnings growth and inflation (2001-07); and rises closer to average earnings

(2007-13).

228

National Minimum Wage

6.138 The minimum wage has done its job well. Before its introduction the lowest paid fared worse

than other workers; since 1999 they have done better, including since the onset of recession

in 2008. This has happened without evidence of adverse employment effects.

6.139 But since 2007 the NMW has not kept pace with inflation. It is worth less now than it was

then. At the same time the NMW has continued to increase as a proportion of average

earnings, since wages generally have experienced an even larger loss of real value.

6.140 This year however we have recommended an increase which should start to restore the real

value of the NMW. Provided economic circumstances continue to improve we expect that

process to continue, so that 2014 will mark the start of a new, fourth phase – of bigger

increases than in recent years – in the work of the Commission.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/288841/The_National_Minimum_Wage_LPC_Report_2014.pdf

Australia:

Abstract

The time series approach used in the minimum wage literature essentially aims to estimate a treatment effect of increasing the minimum wage. In this article, we employ a novel approach based on aggregate time series data that allows us to determine if minimum wage changes have significant effects on employment. This involves the use of tests for structural breaks as a device for identifying discontinuities in the data, which potentially represent treatment effects. In an application based on Australian data, the tentative conclusion is that the introduction of minimum wage legislation in Australia in 1997 and subsequent minimum wage increases appear not to have had any significant negative employment effects for teenagers.

http://onlinelibrary.wiley.com/doi/10.1111/j.1467-8543.2010.00799.x/abstract

As recently as yesterday I posted that I do not support a minimum wage and prefer a form of mincome. However, barring that actually happening, I now think a higher minimum wage may be a more realistic, if a temporary, step.

[Offensive Threat]

There are many countries in the world with NO minimum wages. Surprising 7 of them are in the European Union.

Source:

http://www.cato.org/publications/commentary/let-data-speak-truth-behind-minimum-wage-laws

Countries like Germany, Sweden, Italy, Denmark, and Finland have high standards of living. Do people work for slave wages there?

Update: Germany has introduced a minimum wage this year.

The European union countries you mentioned have wages agreed to in collective bargaining agreements. Just a different form of minimum wage since an employer cannot pay an employee any lower than that amount.

[DarthNinja]

I have no idea why you're comparing it to Canada, when Canada is in a recession and jobs are apparently very hard to come by for people looking. The US has many problems of it's own, but there at least are plenty of jobs.

Seattle is about to have less jobs because people think minimum wage hikes solve problems with poor people being poor/lazy.

Maybe because that's where he/we live? Precisely why who cares?

I see, so poor people are lazy now...there are a plethora of circumstances and elucidations as to why an individual may be poor, which I suppose the same could be said for self-centered, stuck-up a-holes. Poor character let's call it.

[Mr. Ambien]

Maybe because that's where he/we live? Precisely why who cares?

I see, so poor people are lazy now...there are a plethora of circumstances and elucidations as to why an individual may be poor, which I suppose the same could be said for self-centered, stuck-up a-holes. Poor character let's call it.

I just called them lazy, you don't need to call them stuck up a-holes too. That's just mean.

[DarthNinja]

I just called them lazy, you don't need to call them stuck up a-holes too. That's just mean.

I wasn't talking about 'them'. I suppose we need to add obtuse to the description of those I was referring to.

[Mr. Ambien]

I wasn't talking about 'them'. I suppose we need to add obtuse to the description of those I was referring to.

Sorry I don't speak feline/passive aggressive. I'll presume you're talking about them.

[Hugor Hill]

OP article from Fox News

/thread.

/thread.