Caldara misinformed on minimum wage


While discussing the impact that Arizona's higher minimum wage has had on businesses and workers there, Newsradio 850 KOA host Jon Caldara misleadingly stated that most employees earning the minimum wage are "kids." In fact, 71 percent of workers "directly affected" by a potential increase in the federal minimum wage to $7.25 an hour are age 20 or older, according to the Economic Policy Institute.

On the February 12 broadcast of his Newsradio 850 KOA show, host Jon Caldara commented on an article about the impact of higher minimum wages on teenage workers by falsely claiming that "most people who are on minimum wage are kids starting off, not people holding down families." In fact, as Colorado Media Matters has noted, an Economic Policy Institute (EPI) report has concluded that 71 percent of workers "directly affected" by a potential increase in the federal minimum wage to $7.25 are age 20 or older.

Caldara, who also is president of the conservative think tank the Independence Institute, was reading from a February 10 article in The Arizona Republic that reported on the impact a minimum wage hike that took effect in Arizona in January has had.

From the February 12 broadcast of Newsradio 850 KOA's The Jon Caldara Show:

CALDARA: Here's a story from the Arizona Republic: "Oh, for the days when Arizona's high-school students could roll pizza dough, sweep up sticky floors in theaters, or scoop ice cream without worrying about ballot initiatives affecting their earning power. That's certainly not the case under the state's new minimum wage law that went into effect last month. Some Valley employers, especially those in the food industry, say payroll budgets have" written -- "risen so much that they're cutting hours, instituting hiring freezes, and laying off employees." Oh, that was good.

"Companies maintain that new wage that was raised to six dollars and 75 cents from the five-fifteen an hour to help breadwinners in working-poor families. Teens typically have other means of support. Mark Messner, owner of Pepi's Pizza in south Phoenix, estimates that he has employed more than two thousand high-school students since 1990." Those are two thousand people getting their first step on the economic rung. "But he plans to lay off three teenage workers and decrease hours worked by others. Of his 25-person work force, roughly 75 percent are in high school."


CALDARA: "For years, economists have debated how minimum-wage increases impact" teenage workers. The Federal Employees Institute -- excuse me, "the Employment Policies Institute in Washington, which opposed the recent increase, cited 2003 data by the Federal Reserve showing a 10 percent increase caused a 2 to 3 percent decrease in employment." In other words -- it's not a big surprise -- when you force wages up, employment goes down. Since most people who are on minimum wage are kids starting off, not people holding down families -- mind you, there are some -- but mostly these are young kids. These high-school kids that are now getting laid off in Arizona, who does it hurt? Well, most of these kids can live without -- they're living with parents -- but those business owners are going without.

An EPI study based on data from the Bureau of Labor Statistics' 2005 Current Population Survey found that, nationwide, 71 percent of workers earning between their state's minimum wage and $7.25 per hour -- who therefore would be directly affected by an increase in the federal minimum wage to $7.25 per hour -- are age 20 or older, and 25 percent are parents. The Democratic-controlled Congress has passed a bill to raise the federal minimum wage to $7.25 by 2009, from the current $5.15.

Reading from the Arizona Republic article, Caldara also referred to the Employment Policies Institute without disclosing that the organization is, as Media Matters for America has noted, a conservative think tank that receives funding from the fast-food and low-wage hospitality industry and is run by the public relations firm Berman and Company, which has strong ties to the Republican Party.

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