Bluegrass Bullet: May we take your teen's job, please? — The Bluegrass Institute for Public Policy Solutions

May we take your teenʼs job, please?

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9.4 percent of Kentucky’s workforce work in the food-preparation and serving industries, where the average wage is $8.79 per hour. Raising the minimum wage to $10.10 would have a major negative impact on unemployment in the food-service industry in rural Kentucky.

Employers will not pay someone $10.10 hourly to bring in $8 an hour of new revenue.

The person whose skill set combined with the circumstances of time and place allows them to bring in $8 an hour of extra revenue to a firm will be hired if the minimum wage is $7.25 an hour but will lose said job in many businesses if the minimum wage is increased above $8 an hour.

When minimum wages increase, labor costs rise and youth employment falls:

Youth employment is almost half of what it was 25 years ago.

In March 1990, the last month before the minimum wage rose from $3.35 to $3.80, the youth-employment rate was 47.1 percent. By April 1991 – following another increase to $4.25 – one out of 10 teenagers with jobs lost them when the youth-employment rate fell a whopping 4.3 percent to 42.8 percent. The slide continued with the youth-employment rate falling to 40.2 percent by the following March.

“A climb up the income ladder begins by placing one’s foot on the lowest bar. More important than the wage young workers earn is the experience, on-the-job training and self-respect gained from being employed. If society truly wants more people moving up the income ladder, it must stop removing the lowest rungs of that ladder.” –“Minimum Wage and its Effect on Kentucky’s Economy,” a Bluegrass Institute Policy Brief, WKU economist Brian Strow, Ph.D., Feb, 2015