Las Vegas Review-Journal Pens Misleading Editorial To Push Minimum Wage Myths
Research ››› ››› SALVATORE COLLELUORI
A Las Vegas Review-Journal editorial opposing minimum wage laws claimed that minimum wage jobs are only meant to be starting points for young workers who will later seek better paying jobs and that increasing the minimum wage would hurt youth employment, citing a fast food industry lobbyist's think tank to support these claims. In reality, studies show that minimum wage work is not limited to entry-level workers, increases in minimum wage would not hurt youth employment, and Nevada would benefit from an increase in the minimum wage.
Las Vegas Review-Journal Claimed Minimum Wage Jobs Are Only A "Starting Point" For Work Experience
LVRJ: "Jobs At McDonald's Or Burger King Are Not Supposed To Be The End-All Be-All Of One's Employment Hopes And Dreams." An August 4 editorial published by the Las Vegas Review-Journal claimed minimum wage jobs, such as those at fast-food restaurants, are meant to be starting points for work experience not the "end-all be-all" of one's career:
Last week, in seven cities across the country -- New York, Chicago, Detroit, Milwaukee, St. Louis, Kansas City and Flint, Mich. -- rallies were held demanding that the minimum wage for fast-food workers be super-sized to $15 per hour. Many workers walked off the job to show support for doubling the current minimum wage. The idea in theory is that these employees deserve a living wage.
What's lost in that theory is that in general, jobs at McDonald's or Burger King are not supposed to be the end-all be-all of one's employment hopes and dreams. Fast-food jobs, like many other jobs in this country, are more specifically designed to be the starting point for the work experience. The next time you're at the counter or the drive-thru window, look closely and you'll generally see somebody young -- high school or college age -- gaining the valuable skills needed to later embark on a more satisfying career. Showing up on time. Taking directions. Working with others. Dealing with customers. These are all basic necessities that must be learned to attain future success in just about every field. [Las Vegas Review-Journal, 8/4/13]
Minimum Wage Work Is Not Designed As A Stepping Stone For Teens, Entry-Level Workers
Half Of Minimum Wage Workers Are Over 25. Contrary to the conservative talking point that minimum wage jobs are ideally suited for teenagers and entry-level workers, Department of Labor data show roughly half of all minimum wage workers are over 25 years old. [Bureau of Labor Statistics, accessed 7/18/13]
CEPR: Minimum Wage Workers "Older And Better Educated Than Ever." In an April 2012 report, the Center for Economic and Policy Research revealed that from 1979 to 2011 the share of low-wage workers with some college education increased from 19.5 to 33.3 percent. By 2011, 9.9 percent of low-wage workers had completed a college degree, up from just 5.7 percent in 1979. [Center for Economic and Policy Research, April 2012]
Socio-Economic Mobility Is Not Guaranteed For Low-Wage Workers
NELP: Entry-Level Workers "Going Nowhere Fast." In a July 2013 review of low-wage positions in the fast food industry titled "Going Nowhere Fast," the National Employment Law Project found that entry-level positions offered very little room for promotion or advancement. The study also concluded the fast food industry purposely engages in misinformation promoting a "mobility myth" to employees:
Despite what the data make clear about the barriers to upward mobility in the fast food industry, spokespersons for the industry and representatives from the major chains have collectively promoted a "mobility myth" that characterizes low-wage fast food jobs as springboards for advancement to managerial positions or opportunities to open a franchise [National Employment Law Project, July 2013]
BLS: Many Low-Wage Workers Experience Stagnant, Negative Earnings Potential Over Time. According to a July 2006 report in the Monthly Labor Review, the principal journal from the Bureau of Labor Statistics, in the period 1995 to 2001, some permanently employed individuals were able to escape poverty through income gains in low-wage work, but significant numbers saw no income gains or experienced income losses over the long term. From the report:
These comparisons document the fact that, among low-income earners, many see significant gains in income that, if continued, will result in their escaping poverty. However, there is also a sizable component of this population for whom no, or even highly negative, earnings growth is evident, worsening over the long term. [Bureau of Labor Statistics, July 2006]
Las Vegas Review-Journal Claimed Minimum Wage Increases Would Harm Youth Employment
LVRJ: "Doubling The Minimum Wage Or Even Modestly Raising It" Would Only Exacerbate Youth Unemployment. The August 4 Las Vegas Review-Journal editorial claimed that youth employment is greatly affected by minimum wage increases and increasing the minimum wage would "exacerbate" the problem of youth unemployment:
Young, inexperienced workers -- like the ones found in many fast-food establishments -- have been hit hardest by joblessness. Doubling the minimum wage or even modestly raising it will only exacerbate that problem as businesses either stop hiring or worse yet cut back further on staffing. [Las Vegas Review-Journal, 8/4/13]
Studies Show Minimum Wage Increases Do Not Hurt Youth Employment
Economic Policy Institute: "The Warnings Of Massive Teen Job Loss Due To Minimum Wage Increases Simply Do Not Comport With The Evidence." In a November 25, 2009, post, the Economic Policy Institute found that teen employment is affected more by broad economic trends, like a recession, rather than changes in the minimum wage:
Figure B illustrates how teen employment is driven far more by larger labor market employment trends than by any effects of minimum wage changes. The black lines in Figure B mark times when Congress increased the minimum wage to keep up with inflation. The two-step increase in 1990 and 1991 occurred during a period of deterioration in the labor market, and the teen employment share dropped. The two-step increase in 1996 and 1997 occurred during a strong labor market, and the teen employment share increased. The three-step increase in 2007, 2008, and 2009 occurred during a weak labor market, and the teen employment share fell.
This observation is consistent with what careful empirical studies have found. While it is true that there is some disagreement among economists about whether increasing the minimum wage increases or decreases employment, there is a consensus on the essential point: the impact of a minimum wage raise on jobs, whether positive or negative, is small. The warnings of massive teen job loss due to minimum wage increases simply do not comport with the evidence. [Economic Policy Institute, 11/25/09]
University Of California: Minimum Wage Has Nothing "But Very Small Disemployment Effects" On Teen Employment. A June 2010 report by University of California-Berkeley's Institute for Research on Labor and Employment (IRLE) studying the effects of minimum wage increases on teen employment found:
Including controls for long-term growth differences among states and for heterogeneous economic shocks renders the employment and hours elasticities indistinguishable from zero and rules out any but very small disemployment effects. Dynamic evidence further shows the nature of bias in traditional estimates, and it also rules out all but very small negative long-run effects. [Institute for Research on Labor and Employment, UC Berkeley, 6/21/10]
Las Vegas Review-Journal Cites Fast Food Industry Lobbyist's Think Tank Without Disclosing Conflict Of Interest
The Las Vegas Review-Journal Cited Industry-Backed Think Tank To Claim Minimum Wage Would Not Reduce Poverty. The Las Vegas Review-Journal cited a study by the "Economic Policies Institute" [sic] which claimed a higher minimum wage would not reduce poverty and would harm minorities:
[T]he Economic Policies Institute said the study showed that "the higher minimum wage would not reduce poverty, as a majority of beneficiaries live in households with incomes above the poverty level," and that it would disproportionately harm minorities. [Las Vegas Review-Journal, 8/4/13]
The Employment Policies Institute Is A Front Group For The Fast Food Industry
Fox Business Cited Same Quote As The Las Vegas Review-Journal From The Employment Policies Institute. Fox Business cited Michael Saltsman, research director of the Employment Policies Institute, and included the same quote that was included in the Las Vegas Review-Journal editorial:
The Employment Policies Institute (EPI) has multiple studies showing how minimum wage hikes, "including the one called for by the president, lead to job loss, not job creation, as well as fail to reduce poverty or stimulate the economy," says Michael Saltsman, research director at the Employment Policies Institute.
Critics of a minimum wage hike say it would result in businesses hiring fewer workers, or cutting back on the number of current ones.
Research published in the Southern Economic Journal from economists at Cornell and American Universities have estimated that a minimum wage hike proposed by the President "would eliminate at least 467,000 jobs," the EPI notes. "The study also found that the higher minimum wage would not reduce poverty, as a majority of beneficiaries live in households with incomes about the poverty level." [Fox Business, 2/13/13]
General Counsel Of The Employment Policies Institute Is A Lobbyist For The Fast Food Industry. According to a report by CBS, Rick Berman, the general counsel for the Employment Policies Institute, is a lobbyist for "caffeine, salt, fast food and the oil they fry it in. He's against Mothers Against Drunk Driving, animal rights activists, food watchdog groups and unions of every kind." [CBS News, 7/17/07; Citizens for Responsibility and Ethics in Washington, accessed 8/5/13]
Employment Policies Institute Uses Misleading Studies To Claim Minimum Wage Increases Hurt The Economy. According to a report by the Center for Media and Democracy's Source Watch project, the Employment Policies Institute uses misleading studies to push the false claim that raising the minimum wage would hurt the economy:
The Employment Policies Institute was launched in 1991, around the time of the economic recession that led to the electoral defeat of then-president George Bush. EPI deliberately attempted to create confusion in the eyes of journalists and the general public by adopting a name which closely resembles the Economic Policy Institute, a much older, progressive think tank with ties to organized labor. In addition to imitating the name and acronym of the Economic Policy Institute, Berman's outfit even used the same typeface for its logo. In reality, the two groups have dramatically different public policy agendas. The Economic Policy supports a living wage and mandated health benefits for workers. Berman's organization opposes both and in fact opposes any minimum wage whatsoever.
Then, as now, fast-food employees were the largest group of low-paid workers in the United States. One-quarter of the workers in the restaurant industry are estimated to earn the minimum wage--a higher proportion than in any other U.S. industry. This is the real reason why EPI appears on the scene whenever federal or local governments consider a proposal to increase the minimum wage. Its standard tactic is to trot out a study using contrived statistics designed to show that hundreds of thousands of jobs will be lost if the wage is raised. (In reality, studies by labor economists show that the job-loss effect of increasing the minimum wage is either small or nonexistent and that its benefits to low-wage workers and their families far outweigh the costs. Even the Food Institute Report, an industry trade publication, admitted in 1995 that "the weight of the empirical evidence suggests that the effects [on the number of available jobs] of a moderate raise from its current level are likely to be negligible.")
In 1995, EPI lashed out at Princeton University professors David Card and Alan Krueger, after they published a survey of fast-food restaurants which found no loss in the number of jobs in New Jersey after implementing an increase in the state's minimum wage. Berman accused Card and Krueger of using bad data, citing contrary figures that his own institute had collected from some of the same restaurants. But whereas Card and Krueger had surveyed 410 restaurants, Berman's outfit only collected data from 71 restaurants and has refused to make its data publicly available so that other researchers can assess whether it "cherry-picked" restaurants to create a sample that would support its predetermined conclusions. [Center for Media and Democracy, accessed 8/5/13]
Las Vegas Review-Journal Failed To Note Benefits Of Increasing Minimum Wage On Nevada
LVRJ: "Rather Than Relief" Minimum Wage Increases Would Cause "Massive Job Eliminations And No Positive Effect On Poverty." The August 8 Las Vegas Review-Journaleditorial claimed instead of producing job growth and economic benefits for Nevada, increasing the minimum wage would only harm low-wage workers:
So, rather than relief, there are massive job eliminations and no positive effect on poverty. Imagine what a shift upward of $7.25 per hour would do. And that's before getting into how much more the food would cost for consumers, some of whom would stop visiting these establishments, which would then have to let more people go. [Las Vegas Review-Journal, 8/4/13]
Increasing The Minimum Wage Would Have Positive Economic Benefits In Nevada
EPI: A Minimum Wage Increase In Nevada To $10.10 Per Hour Would Affect 243,000 Workers. According to a study by the Economic Policy Institute, increasing the minimum wage in Nevada would create 800 job years and would directly and indirectly affect 243,000 workers. [Economic Policy Institute, 8/14/12]
EPI: Minimum Wage Increase Would Increase Nevada's GDP By $177 Million. The Economic Policy Institute study also found that, for those affected by the minimum wage increase, wages would rise by almost $280 million while the state's GDP would increase by $177 million once fully phased in. [Economic Policy Institute, 8/14/12]
EPI: 49.3 Percent Of Women Would See Benefit From Minimum Wage Increase. The Economic Policy Institute study found that, while Nevada is only one of two states where less than 50 percent of women would benefit from an increase in the minimum wage, 49.3 percent of women in the state would see a benefit from a minimum wage increase. [Economic Policy Institute, 8/14/12]