Lawmakers in Sacramento have raised the minimum wage to one of the highest in the country ($10/hour) — a bad move for California, which needs jobs and is consistently voted as most unfriendly to business. California’s unemployment is several ticks above the national average, so it’s not a good time to raise the cost of labor.
Entry-level minimum wage jobs are not designed to support a family, but rather to evaluate the commercial value of the individuals employed. If successful, they move on to higher-paying jobs. By increasing the minimum wage, entry-level jobs become less available for the very people who need them. Raising the minimum wage may also raise the wages of higher-paying jobs that are based on a percentage above the minimum wage. These jobs may become fewer.
Marginal costs of goods and services may increase because of higher wages, further burdening the poor and unemployed. Companies move offshore because of labor costs. How many California companies will move to Mexico? The unintended consequences of increasing the minimum wage makes it a bad idea. Gov. Jerry Brown should veto it. What’s next for our lawmakers, subsidizing moving to Texas?