The Negative Effects of Minimum Wage Laws (PA 701)

The federal government has imposed a minimum wage since 1938, and nearly all the states impose their own minimum wages. While the aim is to help workers, decades of economic research show that minimum wages usually end up harming workers and the broader economy. Minimum wages particularly stifle job opportunities for low-skill workers, youth, and minorities, which are the groups that policy makers are often trying to help with these policies. In this Policy Analysis, Wilson argues that federal and state governments should focus on policies that generate faster economic growth , which would generate rising wages and more opportunities for all workers.