Minimum Wage

Minimum wage is an artificial restriction of the free market, and all restrictions of the free market come with unintended consequences. When I talk to small business owners in Eastern Washington, they are unanimous in their condemnation of minimum wage. They hire less people because wages are beyond their capability. Thus, their growth is hindered, and in some cases, success is unobtainable.

I got my first job off the farm when I was 13 years old. I was a bag-boy in the local grocery store and was paid 75 cents per hour. A few months later, the supermarket out on the highway offered me 80 cents, and I worked there until I graduated from high school. I considered my labor a commodity, so I sold it to the highest bidder. In less than a year, I had demonstrated a good work ethic and was promoted to stock boy at $1.22 per hour. By my senior year, I had four years seniority, and was foreman of the night crew. I had the opportunity to get experience and learn people skills because my employer could afford me. It took eight years and a college degree before I made more money than I did my last year in high school.

I read a survey a few years ago asking large companies what they looked for when hiring new employees. The three top responses were a work ethic, communication skills and requisite experience.

When asked why they terminated employees, the top responses were not showing up to work on time and inability to get along in the work place. Minimum wage jobs should be opportunities for workers new to the work place to learn those skills. They should be jobs where new employees can prove themselves and gain experience. Minimum wage jobs were never intended to provide a living wage. At best, minimum wage was entry level pay for untested, unskilled labor. It was an opportunity to learn professional skills. That opportunity no longer exists.

The market is always searching for alternatives to lower labor costs. My entry level job doesn’t exist in most stores any more. When bag-boys became too expensive, markets redesigned the checkout such that the sales clerk bags items as they go through the scanner. Now, self-checkout stations are making clerks obsolete. Soon technology will scan customers as they leave the store and automatically debit their accounts. My grandson was fortunate to be able to buy his own gasoline for his first car. He earned a paycheck making sandwiches at Jimmy John’s. He learned skills that will help him stand out from those who have never had the opportunity to prove their worth in the workplace. How long until an automatic sandwich maker eliminates his entry level job?

In the long run, living wage for entry level positions fuels inflation. If we pay $15 per hour for unskilled labor, what will we pay for skilled workmen? Inflation will push wages up until $15 an hour is no longer a living wage. In short term, artificially high wages are disincentive for workers to improve their worth through education and training. Why try to improve yourself if you are making a living wage with no skills?

Artificially high minimum wages harm small businesses, and in the long term they decrease the quality of our national work force.

(Frank Watson is a retired Air Force Colonel and a long time resident of Eastern Washington. He has been a free lance columnist for over 18 years.)