Get the full story on minimum wage news

Recent articles that claim minimum wage increases hurt low-wage workers all have something in common; they look at small areas over short periods of time instead of the big picture. If they took into account changes across the country instead of cherry picking atypical cases, it would show what economists already know: gradual increases to the minimum wage don’t hurt jobs.

For example, one recent article paints a dire picture of Seattle restaurant job losses in the month following their minimum wage change this year (losing 1000 jobs between April and May!). But 800 of those 1000 jobs were gained back again the very next month. And for those of you concerned about how restaurant workers are doing in Arkansas after our minimum wage increase, exactly nothing has happened. At the beginning of the year when the new minimum wage went into effect there were 90,200 employees working in restaurants in Arkansas, by June, that number was still 90,200.

Employment and jobs are volatile. Looking at only one city or one state over a few months is going to give a distorted view. The only way to get a clear picture is to take a big step back and look at how multiple areas have changed after minimum wage increases. For that, we have economists. Here is some comprehensive research on how minimum wage changes affect, or rather don’t affect, jobs:

  • Minimum Wage Effects Across State Borders: Instead of looking at one small area during a short period of time, this study takes a broad look at all minimum wage changes between 1990 and 2006. They compared every pair of US counties that had different minimum wage laws during that time. The researchers found that higher minimum wages didn’t have negative effects on employment in restaurants and low-wage sectors.
  • Why Does the Minimum Wage Have No Discernible Effect on Employment? This is a study of studies. The effect of the minimum wage on jobs is one of the most widely researched topics in economics, so these researchers take a look at what everyone else has found over the past 20 years. Economists are consistently coming to the same conclusion: gradual increases to the minimum wage have little to no effect on jobs.
  • Big Business, Corporate Profits, and the Minimum Wage: A 2015 data briefing from the National Employment Law Project explains that the minimum wages can be increased without job loss because most low-wage workers are employed by corporations who are big enough, and profitable enough, to absorb the costs.

Arkansans overwhelmingly voted in a minimum wage increase that will gradually bring our wage to $8.50 by 2017. Many low-wage workers in our state are already benefiting from the first step of the increase which moved our minimum wage to $7.50 in January.  Find out more about how raising the wage is a great thing for our state in our report.