Race, Politics and the Minimum Wage

Jason L. Riley, Wall Street Journal | May 6, 2011

The summer months will bring summer job seekers, and prospects aren’t good for the nation’s young adults. Overall unemployment just inched back up to 9%, and the teenage unemployment rate in March was 24.5%. Black teens have been faring worst of all, with a jobless rate of more than 42%.

Earlier this week the Chicago Urban League, a civil rights group, released a study of youth employment prepared by Northeastern University’s Center for Labor Market Studies. The authors report that despite renewed job growth last year, “the nation’s teenagers did not manage to capture any of the increase in employment.”

According to the study, 2010 was “the fifth consecutive year in which a new historic low for teen employment was reached.” Based on the first three months of 2011, the center predicts that “only one of every four teens (16-19 years old) would be employed during the summer months of June, July, and August,” which would represent the “lowest ever or second lowest ever summer employment rate for teens in post-WWII history.”

The report goes on to lament that “this national disaster has not received any substantive attention from the nation’s economic policymakers of either political party.” But that’s not quite true, according to a separate study released last month by labor economists William Even of Miami University in Ohio and David Macpherson of Trinity University in Texas. Labor market wage mandates help to explain high unemployment among younger and less experienced workers, contend Messrs. Even and Macpherson. And Congress raised the federal minimum wage by 41% to $7.25 an hour in three stages between 2007 and 2009. The problem is not that policymakers have been indifferent. The problem is that they’ve made matters worse.  (Read more)