Must-Read: John Cassidy: A Fascinating Minimum-Wage Experiment Is About to Unfold

John Cassidy: A Fascinating Minimum-Wage Experiment Is About to Unfold: “The increases in the minimum wage that will be introduced over the next few years…

…are so substantial that some response from employers seems likely…. Southern California will be particularly intriguing. The new law only applies to the city of Los Angeles, which is surrounded by independently run cities and localities. While some of these places may well follow L.A.’s lead, others won’t…. Michael Reich… argues that the fact that the increases in the minimum wage are being phased in over several years will give employers time to adjust to them; he predicts that the ultimate impact on employment will be very minor… that raising the minimum wage to fifteen dollars an hour would cost the city just three thousand four hundred and seventy-two jobs by 2019, which is about 0.2 per cent of over-all employment. And… Reich and his colleagues predicted that Los Angeles County, as a whole, would see a gain in employment of five thousand two hundred and sixty-two jobs by 2019. That’s because all of the low-wage workers who kept their jobs, many of whom live outside the city limits, would get a sizable pay raise. They’d have more money to spend, the over-all level of demand for goods and services would be higher, and so would the level of employment…

May 21, 2015

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