Economist Podcasts Wage against the machine: the distortions of minimum pay
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Nov 25, 2025 
Join Callum Williams, Senior Economics Writer, as he reveals the hidden costs of rising minimum wages and debates whether welfare is a better poverty solution. Alex Hearn, an AI Writer, discusses how AI-generated cover letters dilute hiring signals, impacting wages negatively. Meanwhile, Rebecca Jackson, Southern Correspondent, shares insights on Florida's innovative education reforms, including the rise of homeschooling and micro-schools, while raising concerns about accountability and outcomes in this bold experiment.
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Minimum Wage Raises Pay But Has Hidden Limits
- Higher minimum wages compress pay and raise earnings for many low-paid workers in practice.
- But they can worsen job quality and are a blunt tool for reducing household poverty compared with welfare.
Higher Pay Can Reduce Job Quality
- Raising minimum pay often reduces job quality through less predictable schedules and worse safety.
- Employers respond to higher mandated pay by shifting costs onto conditions and hours.
Wage Hikes Miss The Poorest Households
- Minimum-wage gains often flow to workers in middle- or high-income households, not the poorest non-working families.
- Targeted transfers via the welfare state more directly raise poor households' incomes than high minimum wages.