Thursday, July 30, 2015
Why are we only raising the wage for fast food workers?
From the NY Times:
A proposed increase in the minimum wage in New York State will be substantial, but that’s really not what bothers some economists.
It’s that the raise would apply only to fast-food workers, and only if they work for a chain with at least 30 locations. A wage increase applying to such a narrow segment of the economy is bound to have unintended consequences.
“I have lots of concern with sector- and firm-size-specific minimum wages,” said Lawrence Katz, a labor economist at Harvard University whose research on the economic effects of minimum wages has led him to support higher ones that apply to all workers, both at the national level and especially in jurisdictions like New York, where average incomes and the cost of living are above average.
Some of the problems with a narrow minimum wage are obvious. They don’t do much to raise incomes for workers who don’t work at fast-food chains. And they impose higher costs on some businesses than others; in this case, much higher, as chain fast-food restaurants will be required to pay approximately $6 an hour more than their homegrown competitors.