In the June 2, 1997, Perspective, Bill Henson told us that the minimum wage hike in September 1996 had failed to increase unemployment and bankrupt employers, and therefore was a good thing. I wrote back to state that this grossly misrepresented the projected results of a minimum wage increase and that, in any event, it was too soon to say just what those results were until the Bureau of Labor Statistics could measure and report them.
Well, the story is now in (See the Department of Labor's Web site, stats.bls.gov), and the results are, most unfortunately, about what was predicted.
While the United States as a whole is enjoying the lowest unemployment rate in 24 years (4.6 percent), the group most affected by minimum wage changes, black teenage males, has seen its unemployment rate go up. In September 1996, when the minimum wage was increased from $4.25 to $5.15 an hour, the unemployment rate of this group was 36.6 percent. By November 1996, it had gone to 41.1 percent.
Then the torrid pace of the 1997 economy began to make more entry-level jobs available, and the unemployment rate of black teenage males dropped to 33.9 percent last August. However, in September it jumped back up to 37.6 percent. This is 20 full percentage points worse than for white teenage males — and to think that 40 years ago, 61 percent of black teenage males had jobs vs. 59 percent for whites.
As has been written about previously, an increased cost for hiring entry-level workers has its greatest impact on those who have the weakest qualifications.
Despite these shameful facts, President Clinton has proposed raising the minimum wage again. Why? The ones who really benefit from minimum wage hikes are those union members whose wages are pegged to the minimum. According to an article in the Philadelphia Inquirer, this group of workers numbered about 7.5 million, all of whose compensation is substantially above the minimum wage.
The unions' unsavory role in the 1996 presidential election has been well-documented. One cannot help but see this proposal as nothing more than a political payoff to a well-heeled special interest group.
It says volumes about the political agenda of Jessie Jackson, who is silent on the devastating effect of minimum wage legislation. Fortunately, conservative blacks, such as Walter Williams and Alan Keyes, are willing to speak out.
Roger F. Jones