REPORT: Minimum Wage Increases Actually Do Not Hurt Businesses

The National Employment Law Project (NELP), a national advocacy group dedicated to the employment rights of low-wage workers, just threw its gauntlet into the middle of the wage debate. With thunderous diction and emboldened confidence, the NELP just released a report aimed to once-and-for-all lay bare the actual effects of minimum wage increases on American businesses and the economy.

They titled their report, “Raise Wages, Kill Jobs? Seven Decades of Historical Data Find No Correlation Between Minimum Wage Increases and Employment Levels,” because that’s how you keep the informational pimp-hand strong so it can be purposefully guided to slap the wage argument right in its rhetoric-covered face.

The NELP’s report, examined the effects of each minimum wage increase that has been done in the United States over the 78 years such increases have been made. Using “simple before-and-after comparisons of job-growth trends 12 months after each minimum-wage increase,” the NELP found not only do businesses not suffer and jobs do not evaporate, but total year-over-year employment actually increased 68 percent of the time.

Furthermore, in industries most affected by minimum wage, retail and hospitality, employment numbers increased even more often — 73 percent and 82 percent, respectively.

Minimum wage increases actually create jobs.

For the sake of full disclosure, there were eight occasions when total or industry-specific jobs took losses following a minimum wage hike. While this is true, those losses still do not reflect a minimum wage increase. Five of those instances of post-minimum wage increase job loss occurred when the U.S. economy was actively in a recession, two occurred while the U.S. economy was just coming out of a recession, and one instance occurred when the U.S. economy was barreling into a recession.

These losses are a product of the business cycle, not a raise in wages.

Of their data, the authors state:

“As those results mirror the findings of decades of more sophisticated academic research, they provide simple confirmation that opponents’ perennial predictions of job losses are rooted in ideology, not evidence.”

Of course they are. In Republican America, “pro-business” actually means “anti-worker” and what better way to lay in bed spooning the CEOs of influential American businesses than to peddle false narratives about the dangers of policy ideas that help workers. After all, these “pro-business” conservatives are not only getting off keeping wages down, but also harming workers through ideologically-driven assaults like dismantling unions and making sure employee benefits are just a carrot dangled in front of worker’s faces.

Wages have been stagnant for decades. The current minimum wage, $7.25, has less buying power than the $1.60 minimum wage in 1968. Nearly one-quarter of the U.S. population live in households that qualify for the Earned Income Tax Credit, which is a benefit exclusively for the working poor.

Furthermore, according to a report from the Organization for Economic Cooperation and Development, increasing income equality — which causes a reduction in consumer demand — has dropped U.S. economic growth anywhere from 6 to 9 percent. Put in context, if the U.S. economy were 9 percent bigger today, there would be 11 million more jobs, which would be great for both workers and businesses.

The unfortunate reality of the wage debate is that it’s ideologically-driven, consisting of positions that dictate “if wages go up, employment goes down.” 78 years of data shows that trickle-down model has no basis in reality, while the opposite is true: when workers have more money, businesses have more business, which creates a need for more workers. 78 years of data shows that the stagnant wages employees currently slave over are little more than economic bloodletting and if we’re to make the economy grow, workers need to get paid more.

But good luck convincing conservatives of that. They are, after all, powered by unfounded ideas and unmoved by anything even resembling a fact. So long they continue succeeding in keeping wages down, workers all over the United States will be singing:

report minimum wage businesses workers
GIF via MemeCrunch

Featured image by Massachusetts Cop Block, available under a Creative Commons Attribution-ShareAlike 2.0 Generic license.

h/t Business Insider

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