Minimum Wage

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  • 1938 – Fair Labor Standards ActUnemployment rate for teenage workers is currently at a 61 year high, with over 27% unemployed.Unemployment rate for all workers: 9.5% (October).
  • Minimum Wage

    1. 1. MinimumWage<br />…making poor people poorer since 1938.<br />
    2. 2. Unemployment<br />Unemployment for all workers<br />10.2% unemployed <br />Teenage, unskilled workers<br />27.6% unemployed (61 year high)<br />
    3. 3. Effects of Minimum Wage<br />“Over the last three years, there has been a 41% increase in the minimum wage.”<br />“The rise has priced the unskilled worker right out of the labor market.”<br />Mark Perry, <br />Professor of Economics<br /> University of Michigan<br />-<br />
    4. 4. Supply & Demand<br />Price<br />0<br />Quantity<br />
    5. 5. Supply & Demand<br />- Ice Cream<br />Price<br />$2.50<br />0<br />Quantity<br />
    6. 6. Supply & Demand<br />- Ice Cream<br />Price<br />Surplus Ice Cream<br />Price Floor<br />$20.00<br />0<br />Q<br />Quantity<br />
    7. 7. Supply & Demand<br />- Labor<br />Price<br />0<br />Quantity<br />
    8. 8. Supply & Demand<br />- Labor<br />Surplus Labor (unemployment)<br />Price<br />Price Floor<br />0<br />Quantity<br />
    9. 9. Economic Research<br />STUDY: Minimum Wages and Employment<br />Reviewed more than 100 academic studies<br />Found “overwhelming evidence” that minimum wage increases unemployment for the least skilled workers<br />Almost all studies providing credible evidence point to negative employment effects <br />David Neumark,<br />Professor of Economics, <br /> UC Irvine<br /> William Wascher<br />Economist, Federal Reserve<br />-<br />
    10. 10. Research & Public Opinion<br />A majority of economists agree that minimum wage is harmful<br />A majority of the public favors an increase in minimum wage<br />83% - Gallup Poll, 2006<br />
    11. 11. Summary<br />Minimum wage is intended to help low skilled, generally low income workers.<br />Low skilled workers are losing their jobs with each increase in minimum wage.<br />In a complex economy it can be difficult to see the impact of minimum wage, but as long as the public supports it, congress will continue to increase it.<br />

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