Who could have seen this coming? While facts are awkward things – especially in the face of populist policies – the data shows that retail trade employment growth since the start of the year is notably slower for ‘minimum-wage-hiking’ states than ‘non-minimum-wage-hiking’ states.
As ValueWalk’s Roger Thomas explains,
Seventeen states increased their minimum wages in 2014. Most of the changes happened early in the year.
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It’s still quite early on evaluating how large the adverse employment effects will be, but it looks like the effects are starting to show up in the retail trade employment numbers. As a note on why retail trade, the effects would likely show up in retail trade before they show up in other industries because retail trade employs a large proportion of the minimum wage workers.
Here’s the early evidence.
The figure shows the growth in retail trade by state since the start of the calendar year according to whether or not a state imposed new higher minimum wage rates.
On the left hand side are states that left things as is, meaning these states did not impose any new minimum wage rates.
On the right had side are states that imposed new minimum wage rates.
The figure that matters here is the difference in the average employment growth rate. In states that left business as is, employment growth in the retail trade industry is up 0.72%.
In contrast, states that imposed higher minimum wage rates saw retail trade employment growth of only 0.43%.
Although it’s still too early to say the results are statistically valid, one could likely assume further analysis will find that some or most of the difference is due to higher minimum wage rates.
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It seems Obamanomics has a problem… but when did factual reality ever stop policy-makers and politicians in the past?
via Zero Hedge http://ift.tt/1wq9VxL Tyler Durden