Minimum Wage Increase Could Hurt Job Growth
By: Rae Paterson
Updated: February 13, 2013
JOPLIN, MO.--- During President Obama's State of the Union speech last night, the president proposed raising the federal minimum wage from $7.25 to $9.00 an hour.
The goal of the plan is to boost annual salaries and take millions of Americans out of poverty. However, a study by the Washington-based Employment Policies Institute shows increasing the minimum wage hurts job growth.
Missouri Southern State University Professor, Richard La Near says it could cause layoffs for smaller businesses, raising unemployment. "You've set a new price floor, the wage can't fall below the nine dollars. You've created a surplus of people looking for work, that's called unemployed, the unemployment rate goes up every time we raise the minimum wage."
He adds raising the minimum wage would make the economy weaker than it already is.
The goal of the plan is to boost annual salaries and take millions of Americans out of poverty. However, a study by the Washington-based Employment Policies Institute shows increasing the minimum wage hurts job growth.
Missouri Southern State University Professor, Richard La Near says it could cause layoffs for smaller businesses, raising unemployment. "You've set a new price floor, the wage can't fall below the nine dollars. You've created a surplus of people looking for work, that's called unemployed, the unemployment rate goes up every time we raise the minimum wage."
He adds raising the minimum wage would make the economy weaker than it already is.
