Anyone who doubts that mandated high wages kill jobs would do well to observe the freelance market now thriving through the medium of Internet commerce. Services such as Elance and Amazonís Mechanical Turk offer thousands of opportunities to perform tasks, ranging from the trivial to the highly specialized, for payments that routinely undercut the federal minimum wage. People flock to these sites because the work is easy and some income is better than no income. Itís hard to see how erecting legal barriers to opportunities such as these would make workers better off.
It is unrealistic to expect every job in the labor market to provide a ďlivingĒ wage for a family of four. A vibrant economy relies on a wide variety of different jobs, each with different functions. Not all jobs are meant to sustain a family in the same way that not all vehicles are meant to circumnavigate the globe. Minimum wage jobs, which make up only a small minority even of hourly retail positions, were never meant to function as full-fledged careers. Instead, they are meant to be steppingstones to provide entry-level workers with the experience necessary to leverage better, higher-paying positions in the future.
The problem isnít that wages are too low ó itís that jobs are too few. Raising the federal minimum wage, and especially automating future increases, merely attempts to treat a symptom in a way that will worsen the disease itself. But what else can we expect from a White House whose understanding of the economy is pretty much exactly on par with its understanding of health care?
Adam Brandon is the executive vice president of FreedomWorks, a nonprofit organization that mobilizes grass-roots activists nationwide.
Terri Henderson, 6, center, whose mother is El Salvador, attends a rally with members of Congress at Union Station's Columbus Circle to announce the Restore Opportunity, Strengthen, and Improve the Economy (ROSIE) Act on July 29, 2014. The legislation provides incentives for government contractors to pay a living wage and other benefits that would help low-income workers.