The Effects of Minimum Wage on Employment Rates

In 19 92, a landmark study based on such an experiment changed the face of economics forever. A ten % increase in the minimum wage reduced teen employment rates by one to three%. In fact, between 19 81 and 19 90, the minimum wage remain fixed at three point three five dollars per hour. And yet teenage employment rates hardly changed, even though the relative value of three point 3 5 dollars diminished overtime. The higher price will dissuade customers from buying said products, and the firm will ultimately let go of low skilled employees to remain comparative. It hurts the very same people it is expected to empower.