The proposal may appear beneficial, but the actual effects of such a hike will be fewer opportunities for less-skilled job seekers in a state where more than a quarter of them already can't find work.
Businesses that hire entry-level employees and pay them minimum wage -- restaurants or grocery stores, for example -- often keep 2 to 3 cents in profit from each sales dollar; they can't just absorb the increase. Raising prices on cost-conscious customers typically isn't an option, either, because sales fall as a result. Businesses are instead forced to provide the same service at a lower cost -- that means more self-service, and fewer job opportunities for the same people the governor is concerned about.
The evidence backs up the intuition: Recent research published in a Cornell University academic journal found a greater than 20 percent drop in employment for less-educated New Yorkers following the last state-mandated wage hike.
Michael Saltsman, Washington
Editor's note: The writer is the research director for the Employment Policies Institute, a fiscally conservative, nonprofit research organization that studies employment issues.