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  • Progressive Policies Harm Youth Employment

    6/10/2013 5:46:32 PM Posted by Hillary Cherry

     By: Eduardo Miranda, Young America's Foundation Intern

    sad youth 2At a recent policy discussion I attended in New York City, several individuals embraced support for increasing the city's minimum wage. One individual declared support for an $11.50 minimum wage, garnering praise from onlookers.

    It is these knee-jerk reactions that make progressive policies impossible. Let's take a simple look at what would happen to the youth employment if the living wage was raised to such high levels.

    Business owners take on costs to provide a particular good or service. If the cost to provide a product increases, then the employer will have to adjust to these changes. The only options then will be either to find new ways to decrease costs, or, raise the price of their product.

    Consumers won't like an increase. In turn, they will buy less of that product.

    Let's take a good old-fashioned American cheeseburger as an example. Usually, one can be bought for a dollar and I normally buy two. One day, the costs of producing that cheeseburger rises on the supplier, and subsequently, he is faced with the dilemma, cut costs, or raise prices. He decides to raise prices on a cheeseburger to two dollars, which means I have to pay four dollars for my usual two cheeseburgers, something I am not willing to do, therefore I find another cheeseburger place that charges left.

    The second option is to reduce his costs, which are simple enough to understand. He incurs costs for supplies, labor, and location. Finding a new supplier who charges less, but offers similar quality is difficult enough, let alone the fact that he has to do this while maintaining a continuity of service (or else he won't make any money, and go out of business).

    This leaves labor as the easiest to adjust quickly because an employer dictates who gets hired. This is where students are most affected.


    Young people do not typically possess comparable skills to those who have been in the working population longer, therefore the employer faces another dilemma when hiring. His options are either a teenager who has never had a job, or someone who has been in a working environment before. The employer must now take into account that they must also pay this new employee more than they did before, making his investment in an employee even trickier. Smart money says go with the guy who has had a job before, and the student loses out on a job he needed.

    Progressives counter this claim by adding a third option-the producer can make less profit. Well, here in America, we have a little something called property rights, which is the only reason most of us do anything. A business gives up something (usually a career) in order to focus on building a business. If they see less opportunity in starting a business than in keeping a career, they probably won't take the risk of starting that business.

    Who loses out? Students and cheeseburger-lovers everywhere.


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