An old argument has popped up again, mainly due to publicity from Bernie Sanders. The argument goes like this. Anti-poverty assistance given by government to low-wage employees is actually a subsidy to the employer, not the employee. That’s because government assistance allows businesses to pay lower wages. Is the argument true? Let’s take a look. … Continue reading Does government safety net subsidize businesses?
Some people worry that minimum wage in the US has not kept up with inflation. They usually say that minimum wage should be $10 to $15 per hour instead of the $7.25 it actually is. For example, the Economic Policy Institute dolefully says, “[m]inimum wage increases have been too infrequent to keep up with inflation, … Continue reading Has minimum wage kept up with inflation?
In the past couple months, people have been promoting the idea that government should provide guaranteed jobs. Let’s explore why this is a bad idea. What is happening The general idea is that government would provide a guaranteed job to anyone “who wants or needs one.” The number of jobs would probably be in the … Continue reading Why government-guaranteed jobs are a bad idea
Some occupations require people to obtain a license before they can work in that profession. Is this good for society? Let’s take a look. What is occupational licensing? An occupational license represents government permission to work in a certain profession. In some cases, permission is granted by a separate, government-approved body. Licensing laws vary, but … Continue reading A license to… shampoo?
Over the past few months, we’ve seen some good news about employee wages. There are lessons to learn from this. The good news First, let’s take a look at the good news: (1) The average hourly wage increased in January at a 2.9% rate. Although that’s not great, it’s the highest since mid-2009. (2) The … Continue reading Lessons learned on wages
Big Government advocates often claim that we have government to thank for our modern 40-hour work week. In the bad old days, businesses forced employees to work super long hours, but then benevolent government stepped in and forced all businesses to limit the work week to 40 hours. How much of that is true? Let’s … Continue reading How did we get the 40-hour work week?
US unemployment shot up sharply during the Great Recession of 2008-2009. Since then, it has dropped back to more normal levels. Is unemployment now low enough? Let’s look at some facts. Multiple unemployment metrics The unemployment rate is defined as the percentage of the overall labor force that is jobless. Simple enough, right? Not really. … Continue reading Has unemployment dropped enough since the Great Recession?
A few weeks ago the mayor of Baltimore said she would veto an increase in the city's minimum wage to $15 per hour. She said it would put the city at a competitive disadvantage versus the surrounding area. Hurray for a moment of economic sanity in the “Fight for Fifteen.” The mayor is absolutely correct … Continue reading Baltimore Faces Reality on Minimum Wage