re: #941 garhighway

a priori

Wages are prices. Business owners pay wages to their employees because of the added value those employees bring to the business operation. For instance, if a worker can add $27 in value, an owner will hire that person at a wage at or below that rate, but never above. In the case of low skilled workers, the amount of value added is a lot less. lets say $5/hour. If the minimum wage is set at $7 per hour, then to hire that worker the owner will have to be willing to take a loss of $2/hour. Why would he do this? Would you? I wouldn’t. Empirically you can see this by the disappearance of elevator operators, move theater ushers and many other jobs that used to be done by the young and unskilled. those jobs no longer exist because it is not economically viable to keep these people employed at the minimum wage rates set by government. If you must pay $7/hour, then as a business owner you will be more likely to hire someone who has experience, is older, and who is more educated, which has a negative effects on the groups previously mentioned and minorities who are victims of a failing public school system.