Conservatives oppose the minimum wage on the grounds that since wages follow the logic of economics--the more expensive something is, the fewer buyers there will be--raising the minimum wage will lead to reduced employment or reduced hours of employment.  They also argue that the minimum wage is so often paid to teenagers starting out in part-time jobs that it is an inefficient way to help poor families.  Most of the sources here were occasioned by Congressional bills to raise the wage, but the underlying theme is the perennial conservative one: tampering with the open market never helps anyone. 

         For newcomers to the minimum wage argument, the debate can be bewildering.  What follows are three suggestions for getting one’s bearings among the claims and justifications. These prompts can be applied to both sides of the debate, but to this editor who supports the minimum wage, they are most compelling as ways to see the fallacies in arguments against the minimum wage.

1. When reading a position on the minimum wage, take a good look at the numbers. They are rarely as neutral as they may appear.  Writers hope they will boost their case or discredit the opponent’s.  Evaluate the claim—sometimes stated, often not—that a number is dramatically large or impressively small.  Turn percentages into real numbers when you can.  Turn real numbers into percentages and fractions to see what they amount to.  Critics of the recent federal minimum wage increases, for example, liked to point out that minimum wage amendments in Congress called for a raise of 41 %, implying that such an increase in very low hourly wages is as outrageously large as it would be for annual salaries.  It helped to remember that the actual amount of controversial increase was from $5.15 an hour to $7.25 over two years.  

Look at the remainder of numbers, the balance on the other side.  For example, an anti-minimum wage position is that 65% of minimum wage workers get raises in the first year, so a minimum wage increase just isn’t necessary.  But the remainder—about one third of those workers—do not get the raises, according to this statistic, and one might ask, as proponents indeed do, how long those workers stay stuck at the minimum, or if they keep working at all at that wage.  

2. Be aware of definitions; beware of stereotypes. 

“Poverty” - Claims about whether the minimum wage helps people to escape poverty are based on the federal poverty line.  This line, although it increases slightly each year to reflect inflation, is unrealistically low—approximately $15,000 for a family of three, for example.  Because this line is so low, many struggling families--and the low-wage workers in them--are, technically speaking, “not poor.”  That is, the combined low wages of the adults in a household may well place the household as a group above the poverty line.  And because the federal poverty line is low, a family that is above this line may well be nonetheless poor in reality.  Those opposed to the minimum wage often write that only a small percentage of minimum wage workers are poor--below the federal poverty line--and therefore that raising the minimum wage will help only a few poor families.  Such claims can be made in part because the minimum wage refers to one person's earnings while "poverty" is offiically defined by the income of the family or household group.   

“Teenagers” - Anti-minimum wage sources often point out (accurately) that many low-wage workers are teenagers living at home.  The stereotype here is that those teenagers are middle-class kids from families who are hardly poor at all and that they will be spending their wage increase at the local mall. But many teenagers are from lower economic strata and the money they make helps meet the most basic expenses for themselves or the family. 

“Sole earners”,  “Second earners” - Writers opposed to the minimum wage make claims to the effect that only 10% of minimum wage workers are sole earners in a family with children.  The implication is that second-wage earners in a household (teenagers, partners, other household members) bring home some bonus spending money, while in fact at lower economic levels the household needs every income source it can find. 

“Minimum wage worker” - One might assume that this phrase refers to someone who earns exactly $5.15 per hour.  But in different papers it can mean different groups.  It can include restaurant waiters who receive the lower minimum “tip” wage.  Sometimes it includes those earning just above the federal minimum (a dollar more, for example) on the grounds that such workers are in the same financial boat.  And in states with their own higher minimum wages (some of them  $7 or more),  a minimum wage worker may be significantly better off than one who earns the federal minimum.  So different reports about “minimum wage workers” might be comparing apples and oranges. 

3. Ask, "Who benefits?”  What economic motives drive or might drive a minimum wage argument?  Unions support minimum wages (although their members earn more than such minimums) in part because an increase nudges all wages upward.  On the other side, a favorite piece of pseudo-altruism from opponents is that the minimum wage hurts those it is supposed to help because it puts people out of jobs.  But business owners and conservatives rarely level about their biggest concern: a minimum wage increase might reduce profits.

                                   -- Brock Haussamen; revised August 2007