The “recovery” from the Great Recession has been anemic. Business growth, job creation, and consumer spending remain tenuous. Since the official trough in June 2009, median income has fallen, real wages have barely risen, unemployment remains elevated, and because so many Americans have left the workforce entirely, the fraction of the population working is below the pre-recession level.
To address the very real concerns of out of work and low-wage workers, many of our nation’s policymakers point to raising the minimum wage as a “silver bullet” solution. Although increasing wages through legislative action may sound like a great idea, poverty is a serious, complex issue that demands a comprehensive and thoughtful solution that targets those Americans actually in need.
As economists, we understand the fragile nature of this recovery and the dire financial realities of the nearly 50 million Americans living in poverty. To alleviate these burdens for families and improve our local, regional, and national economies, we need a mix of solutions that encourage employment, business creation, and boost earnings rather than across-the-board mandates that raise the cost of labor.
- Minimum Wage in US / Much of the empirical evidence suggests that it fails to alleviate net poverty says CATO
- US – Yellen backs CBO’s minimum wage report
- US / Low-paying jobs and the minimum-wage battle
- Minimum Wages Around The World
- Minimum Wage Estimated Impacts in US / CBO Director defends position
- US / A small, and shrinking, proportion of jobs pay enough for families to make ends meet finds the 2013 Job Gap Report by the Alliance for a Just Society