The most popular counter-argument against minimum wages advocates is that requiring higher pay will result in higher prices, fewer hours of work, and an overall reduction of jobs. But in 2014, 18 states and D.C. raised their minimum wages, and the results have been quite clearly positive for local economies, reports The Atlantic.
The White House Council of Economic Advisors (CEA) analyzed the effect of raising the minimum wage above the federal minimum of $7.25 in 18 states (plus D.C) and arrived at this conclusion: In those areas, the low-income workers who are supposed to benefit from a minimum wage hike did, without any collateral damage. Via the authors:
Specifically, the CEA examined economic data from the Bureau of Labor Statistics on workers in the leisure and hospitality industries, who are among the lowest paid in the country. In the states where minimum wage was raised, hourly wages and weekly earnings grew by at least 6.6 percent more than in states without the hikes.
"Fight for $15" activists may not be wrong then.
As reported in The Atlantic.