One of those ideas that always comes out of hiding when conservatives need another (phony) reason to blame economic ills on those pesky liberals is that the very existence of the minimum wage puts the very people out of work who supposedly benefit from it. I’ve already addressed this on the blog before, so I’m not going to go into a great deal of detail debating the same points again. This latest attack comes via Charles Laneon the Washington Post. Here’s what he has to say:

Reduce the federal minimum wage. In 2007, Congress enacted a three-step increase in the minimum wage, which was then $5.15 per hour. The final installment took effect in July, raising the rate to $7.25 per hour. In the meantime, unemployment climbed from 4.7 percent to 9.5 percent.

I am not saying that the minimum wage increase caused this; far from it. But study after study has shown that this supposed benefit to the poor prices low-skilled workers out of entry-level jobs. It was unwise to keep raising the cost of hiring them in a recession.

Now Lane quotes an economist named David Neumark published in the WSJ in support of his assertion. I shall do so as well:

Despite a few exceptions that are tirelessly (and selectively) cited by advocates of a higher minimum wage, the bulk of the evidence — from scores of studies, using data mainly from the U.S. but also from many other countries — clearly shows that minimum wages reduce employment of young, low-skilled people. The best estimates from studies since the early 1990s suggest that the 11% minimum wage increase scheduled for this summer will lead to the loss of an additional 300,000 jobs among teens and young adults. This is on top of the continuing job losses the recession is likely to throw our way.

I’ll take his word for it that there are such studies, although in today’s online world I just don’t know why he can’t link to some of them. But there are plenty of studies that point the other way as well. Check out what the Economic Policy Institute says:

Instead, Figure B illustrates how teen employment is driven far more by larger labor market employment trends than by any effects of minimum wage changes. The black lines in Figure B mark times when Congress increased the minimum wage to keep up with inflation.  The two-step increase in 1990 and 1991 occurred during a period of deterioration in the labor market, and the teen employment share dropped.  The two-step increase in 1996 and 1997 occurred during a strong labor market, and the teen employment share increased. The three-step increase in 2007, 2008, and 2009 occurred during a weak labor market, and the teen employment share fell.

This observation is consistent with what careful empirical studies have found. While it is true that there is some disagreement among economists about whether increasing the minimum wage increases or decreases employment, there is a consensus on the essential point: the impact of a minimum wage raise on jobs, whether positive or negative, is small. The warnings of massive teen job loss due to minimum wage increases simply do not comport with the evidence.

I suggest reading all three articles in their entirety in order to fully comprehend the arguments for and against minimum wage. However, the EPI is right when it says that there is no link between minimum wage and employment. If that assertion were true, one would have to somehow reconcile the fact that as we have increased minimum wage over the course of decades, employment has fluctuated both up and down reflecting no absolute gain in unemployment over time which reflects the increases in minimum wage. In other words, they would have to show that before a minimum wage was ever instituted, employment was a certain percentage (low, since we’re blaming lots of unemployment on every increase). Let’s just say it was supposedly 10% (in U-6 terms). Supposedly, MW increases would have raised that percentage absolutely over time regardless of temporary fluctuations in employment related to economic cycles.  Is that what we see happening? Let’s check out this chart, which gets its figures from BLS numbers.

In 1920, the rate is 5.2%. In 2001, it’s 4.7%. So where’s the absolute increase in unemployment caused by minimum wage? If you look over the chart you can easily see that fluctuations are occurring constantly, but that overall unemployment has not risen in an absolute sense. In short, get over it, conservatives. Minimum wage isn’t hurting anybody.