Spring Break
Minimum wage study discovers downside
SARAH WATKINS
Issue date: 9/20/07 Section: News
- Page 1 of 1
The minimum wage handicaps its recipients according to a study published by University professor Joseph Sabia on the impact of a minimum wage increase on single mothers.
The two-year study was funded and released through the Employment Policies Institute, a nonprofit organization based out of Washington, D.C. and focuses on public policy issues involving growth in employment, according to their Web site.
Jill Jenkins, the chief economist at the Employment Policies Institute, said the study focused on mothers between the ages of 16 and 55.
According to the EPI Web site, Professor Sabia "uses data from a pooled cross-section of unmarried mothers from the March 1990 to March 2005 Current Population Survey."
Sabia said in an e-mail, "My research shows that the one-two punch of firings plus cuts in hours actually reduces wage income for many less-educated single mothers. Thus, in the name of giving the poor a helping hand, minimum wage increases actually do them harm."
Jenkins said raising the minimum wage causes companies to reevaluate employees. If fired, those without a high school education are less likely to find a new job.
She said people who have no problem getting raises on their own are the ones who will benefit from a minimum wage increase.
Sabia found "for every 10 percent increase in the minimum wage, the average single mother without a high school diploma sees her income decline by almost nine percent," according to a news release.
Eighty-seven percent of the benefits from recent federal wage increase goes to families that aren't poor.
The census conducted in 2000 for Athens-Clarke County found it has 3,128 households with children under 18, a female householder and no husband present - 7.9 percent.
Jenkins said the study should impact how people vote on minimum wage increases if people pay attention to what the data says.
"I have presented results from this study to the U.S. Senate Finance Committee and the Indiana House and Senate labor committees. The response from policy makers has been one of surprise and interest. I have done my best to let the nation's minimum wage advocates know that crafting public policy isn't like giving Christmas gifts. It's not the thought that counts. Especially when feel-good legislation designed to help the working poor has been repeatedly shown to do precisely the opposite," Sabia said.
A complete copy of the study can be found at www.epionline.org.
The two-year study was funded and released through the Employment Policies Institute, a nonprofit organization based out of Washington, D.C. and focuses on public policy issues involving growth in employment, according to their Web site.
Jill Jenkins, the chief economist at the Employment Policies Institute, said the study focused on mothers between the ages of 16 and 55.
According to the EPI Web site, Professor Sabia "uses data from a pooled cross-section of unmarried mothers from the March 1990 to March 2005 Current Population Survey."
Sabia said in an e-mail, "My research shows that the one-two punch of firings plus cuts in hours actually reduces wage income for many less-educated single mothers. Thus, in the name of giving the poor a helping hand, minimum wage increases actually do them harm."
Jenkins said raising the minimum wage causes companies to reevaluate employees. If fired, those without a high school education are less likely to find a new job.
She said people who have no problem getting raises on their own are the ones who will benefit from a minimum wage increase.
Sabia found "for every 10 percent increase in the minimum wage, the average single mother without a high school diploma sees her income decline by almost nine percent," according to a news release.
Eighty-seven percent of the benefits from recent federal wage increase goes to families that aren't poor.
The census conducted in 2000 for Athens-Clarke County found it has 3,128 households with children under 18, a female householder and no husband present - 7.9 percent.
Jenkins said the study should impact how people vote on minimum wage increases if people pay attention to what the data says.
"I have presented results from this study to the U.S. Senate Finance Committee and the Indiana House and Senate labor committees. The response from policy makers has been one of surprise and interest. I have done my best to let the nation's minimum wage advocates know that crafting public policy isn't like giving Christmas gifts. It's not the thought that counts. Especially when feel-good legislation designed to help the working poor has been repeatedly shown to do precisely the opposite," Sabia said.
A complete copy of the study can be found at www.epionline.org.
Viewing Comments 1 - 9 of 13
b.o.o.h.o.o.
posted 9/20/07 @ 9:42 AM EST
This sounds like doublespeak. Raising minimum wage affects everyone who depends on it to make a living. It sounds like the one-two punch of being a single mom WITHOUT CHILD SUPPORT and having to pay for child care, and having to choose to either go without further education and accept lower wages or neglect your family to get it are what at's issue here. (Continued…)
Ben C
posted 9/20/07 @ 2:55 PM EST
Everyone should realize that the Employment Policies Institute is sponsored by big business groups that are ardently opposed to the minimum wage. This article is terribly slanted as a result. (Continued…)
RMS
posted 9/20/07 @ 3:13 PM EST
Everyone should also realize that big businesses are opposed to minimum wage because it artificially raises the price of labor, forcing them to have to cut back on their labor costs by hiring less and firing more, affecting poor people the most. (Continued…)
Zaid
posted 9/20/07 @ 5:48 PM EST
Employment Policy Institute is a far-right business-backed think tank; I can't criticize their study until I see it, but people should be aware of that. (Continued…)
Jeremiah Johnson
posted 9/21/07 @ 12:22 AM EST
I really think it's funny when people who don't understand economics talk about economics. As an econ major, I wouldn't try to argue with a chemistry major about chemical reactions, it would be dumb of me. (Continued…)
Keri
posted 9/21/07 @ 1:19 PM EST
I'm no chemistry major, so I do not feel as though I am out of my league in this argument. I'm a 4th year Econ major and although I understand your argument, Jeremiah, I also am quite aware that government regulation of the minimum wage, and markets in general will never cease. (Continued…)
Jeremiah Johnson
posted 9/21/07 @ 3:46 PM EST
Again for those people who are too dumb to understand economics.
"I disagree with your logic here. You seem to suggest that poor people should die so that businesses can survive since paying them more would be bad for business. (Continued…)
Stephen
posted 9/21/07 @ 4:32 PM EST
It's strange to me that the free-market fundamentalists often choose the minimum wage as the entry point into economic liberalization. Of all the ways that governmental regulation "corrupts" market activity, is this the one area that requires immediate and ardent concern?
From federal manipulation of oil and defense industries to big-box manipulation of local lawmaking; there are plenty of ways that the intermingling of government and market corrupt the free market. (Continued…)
Bridget
posted 9/24/07 @ 8:26 AM EST
Well if the single mom wouldn't have been easy in high school, had a baby and dropped out then they wouldn't be in this situation, would they? It seems like they only have themselves to blame. (Continued…)
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