Recently, minimum-wage increases to $15 an hour have been approved for workers in Seattle, hotel workers in Los Angeles, and fast-food workers in New York; and there are demands to increase the national minimum wage from its current $7.25 to at least $10 per hour. It is important for government to set a wage floor, and empirical studies generally indicate that previous minimum-wage increases have had only very small adverse impacts on employment. Given the wages gained by the vast majority of affected workers, we strongly supported past minimum-wage increases.

We have three concerns, however, that moderate our support for future increases. First, the latest proposals are for much larger wage increases than in the past and would be adjusted annually to reflect cost-of-living increases. Second, they would have little impact on poverty rates. Finally, the modest adverse employment effects may be concentrated on young workers — a worry buttressed by a new analysis we conducted ourselves.

Read the article “Hiking the Minimum Wage: New Evidence on the Impact” on realclearpolicy.com.