Labor Union Bosses Call for Massive Layoffs

Minimum Wage Hike Would be Detrimental to Entry-Level Workers and Those Looking to Break into the Middle Class

May 15, 2014

by Brett Healy
MacIver Institute President

Once again, labor union bosses have organized fast food strikes all across the country, claiming they want workers to make $15 an hour and have the right to form a union. But, what do the union bosses really want? They want more of your hard-earned money for their unions from compulsory dues – no matter how many lose their jobs.

I bet during all that organizing, union bosses forgot to tell workers about all the research that shows raising the minimum wage is a bad idea.

The non-partisan Congressional Budget Office (CBO), which is trusted by Democrats and Republicans when it comes to fiscal policy analysis, released a report in February that shows 500,000 people would likely lose their jobs if the minimum wage was raised to $10.10 an hour. The CBO said it could be as high as one million jobs lost.

If one million jobs could be lost under an increase to $10.10 an hour, just imagine how many hard-working parents, college students and teenagers would be fired if the minimum wage was hiked to $15 an hour.

Here in Wisconsin, raises in the minimum wage over the past decade have already cost thousands of workers their jobs, especially among young people. The MacIver Institute published a report showing more than 7,000 eager young Wisconsinites would be working today had the minimum wage not been raised three times since 2002.

On top of our research and data from the non-partisan CBO, more than 500 economists, including four Nobel laureates, signed an open letter in March urging political leaders to scrap plans for a higher minimum wage.

“One of the serious consequences of raising the minimum wage is that business owners saddled with a higher cost of labor will need to cut costs, or pass the increase to their consumers in order to make ends meet,” the economists wrote. “Many of the businesses that pay their workers minimum wage operate on extremely tight profit margins, with any increase in the cost of labor threatening this delicate balance.”

Fewer jobs and higher costs – that is a lose-lose situation for the entry-level workers proponents claim to be helping.

Our state’s leaders need to implement pro-growth policies that strengthen our economy and create new opportunities for all, not an artificial wage increase that will only hurt Wisconsin’s small businesses and lead to massive job losses.

It is clear that raising the minimum wage will have a harmful effect on our economy. Increasing the cost of a good or service means less of it will be purchased, and the same goes for higher labor costs.

This is why it is plain to see that the union bosses organizing these protests are clearly looking out for their bottom line, and not the bottom line of families all across our state and our country.