Business groups wrong on minimum wage
Another oft-repeated talking point from opponents is that the minimum wage was created as a starting wage for teenagers entering the workforce. Though this blatant (and convenient) rewriting of history is repeatedly corrected by minimum wage advocates, it persists nonetheless. In fact, we can look to President Franklin Delano Roosevelt’s own words in a speech he gave in support of the National Industrial Recovery Act in 1933, as evidence:
“It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country.”
A 2013 report published by the National Employment Law Project (NELP) looks at 100 years of opposition to the minimum wage.
I can attest that, at least in Hawaiʻi, these oppositional talking points haven’t changed. Despite a preponderance of evidence contradicting the fear-mongering, increases in the minimum wage have not caused the financial sky to fall. One might practically expect nothing less from industries that rely on cheap labor for their profits.
Industry groups, like the Restaurant Association for example, have for a century warned that forced wage increases would lead to business closures and job losses. The NELP report highlights in one of its many figures the steady growth of the restaurant industry from 2007 to 2013 as compared to an increase in the federal minimum wage over the same period. In Hawaiʻi, according to the U.S. Small Business Administration, between 2014 and 2018:
The number of people employed by small businesses (defined as up to 500 employees) increased by 3% to 275,076.
The total number of small businesses grew by 8% to 137,328.
The number of very small businesses (up to 20 employees) grew by 3% to 21, 541.
It should be noted that during that same period, in Hawaiʻi, the unemployment rate dropped each year the minimum wage increased.
In fact, there is no reliable statistically significant data that I could find that shows a direct correlation between business closures and increases in the minimum wage.
