Republican Representative Marsha Blackburn of Tennessee talked to CNN about the importance of having an entry-level wage in order to decrease unemployment and get more teens into the workforce:
What we’re hearing from moms and from school teachers is that there needs to be a lower entry level, so that you can get 16-, 17-, 18-year-olds into the process. Chuck, I remember my first job, when I was working in a retail store, down there, growing up in Laurel, Mississippi. I was making like $2.15 an hour. And I was taught how to responsibly handle those customer interactions. And I appreciated that opportunity.
Travis Waldron of ThinkProgress, however, takes her numbers as an argument for raising the minimum wage:
Making $2.15 an hour certainly does sound worse than today’s minimum wage, which federal law mandates must be at least $7.25 an hour. But what Blackburn didn’t realize is that she accidentally undermined her own argument, since the value of the dollar has changed immensely since her teenage years. Blackburn was born in 1952, so she likely took that retail job at some point between 1968 and 1970. And according to the Bureau of Labor Statistics’ inflation calculator, the $2.15 an hour Blackburn made then is worth somewhere between $12.72 and $14.18 an hour in today’s dollars, depending on which year she started.
This is not an oops.
First of all, Blackburn did not say she had a minimum wage job—she said she had a retail job at a young age which enabled her to learn the value of hard work and good service.
Here are two charts which can help one better understand why the inflation argument is invalid:
In 1968, the minimum wage was at its highest point relative to inflation in the past 60 years, the equivalent of $7.21 in 1996 dollars. The ridiculously low unemployment rate of 3.6% jumped from 4.9 to 5.9% in the following years with the 1968 minimum wage increase—and this was before stagflation. By 1975, unemployment was at a staggering 8.5%, more than double the 1968 rate. In 2000, when the unemployment rate was similar to 1968 (4.0%), the unemployment rate was $4.69 in 1996 dollars, decreasing from $5.03 a couple years prior. And in 2006, when unemployment was at a low 4.6%, the minimum wage was at $4.04 in 1996 dollars—the lowest level in 60 years. In 2009, the minimum wage was raised to its highest level since 1982–$5.30 in 1996 dollars—and the unemployment rate jumped from 5.8% to 9.3%. It’s clear—minimum wage increases unemployment and, with a swiftly-changing market, employers must react far more quickly to minimum wage increases now than they did in the 1960s.
Second of all, it’s simple economics that raising the minimum wage directly hurts high school age kids and teens trying to get basic jobs to start earning money. They are the first to go when companies are restricted on the number of people they can hire due to wages that brush against razor-thin margins.
It’s simple what proponents of raising the minimum wage are saying: we want higher unemployment, we want less teens to have jobs, we want businesses to be able to hire less employees, expand less, invest less, and therefore cause the cost of goods and services to increase. Marsha Blackburn commenting on the importance of young folks getting a job and doing hard work is one of the best arguments for why there cannot be a raise in the minimum wage.
