Home
/
RELIGION & LIBERTY ONLINE
/
How Four States Voted to Hurt Low-Skilled Workers
How Four States Voted to Hurt Low-Skilled Workers
Sep 10, 2025 12:25 AM

Last night the election results revealed wins for Republicans in almost every state. But in four states where the GOP gained ground — Alaska, Arkansas, Nebraska, and South Dakota — the poor and unskilled suffered a loss.

In each of those states, voters passed ballot measures that will increase the government-mandated minimum wage. Beginning in 2015, the wage in South Dakota will increase to $8.50 an hour. In 2016, Alaska’s wage will be $9.75 an hour and $9 an hour in Nebraska. Arkansas will also raise the wage-floor to $8.50 an hour by 2017.

While the measures passionate — who doesn’t want hard-working people to receive more money? — the effect will be that each of those state will likely see unintended consequences of the action.

Here are four ways the increased minimum wages will hurt low-skilled workers:

1. Minimum wage laws will reduce the number of low-skilled jobs —even in states that didn’t raise the wage — In 1950, there were over 81,000 gas stations and only about200 self-service stations(almost all in California). Self-service stations weren’t popular until the two gas shortages in the 1970s (1973 and 1979) caused higher fuel prices that ledconsumers to look for pricing relief. Almost overnight, full-service stations became all but extinct—taking an entire sector of low-skilled jobs with it.

Rapidly increasing the minimum wage will have the same effect. A small group of employees will see their pay increase while many more would find their jobs pletely, never e back. Because most of the increases won’t occur for 2-3 years, employers have time to find alternatives to the increased cost. One of the most likely changes will be automation in the fast-food industry.

In Europe, McDonalds has ordered7,000 TIOSs (Touch Interface Ordering Systems)to take food orders and payment. In America, Panera Bread willreplace all of their cashierswith wage-free robots in all of their 1,800 nationwide locations by 2016. There is even a burger-making robot that can churn out360 gourmet hamburgers per hour. Increasing wages will encourage corporations to speed up the implementation of automated services. By the time the wages go into effect in Arkansas, there will likely be fewer fast-food jobs available.

But the corporations won’t just use the automation in states with high minimum wages; it’ll be more cost-effective to roll them out nationwide. So the unintended consequences in these four states will affect the labor market for the whole country.

2. Minimum wage laws don’t substantially affect poverty — Most people who support or oppose minimum wage laws and/or increases share mon objective — helping the working poor. Because both sides have noble intentions, the merits of the debate over minimum wage laws and minimum wage increases should be based on empirical evidence that it will actually help, rather than harm, the poor.

Ina piece for the National Center for Policy Analysis, David R. Henderson explains there are two myths about minimum wages and the poor:

Most workers earning at or close to the minimum wage are not the sole earners in a household and most of them are not in poor households. For those two reasons, raising the minimum wage is not a targeted way to help poor people.

Henderson notes that from 2003 to 2007, 28 states raised the minimum wage to a level higher than the federal minimum wage. Using this as a basis for study, San Diego State University economics professor Joseph J. Sabia and Cornell University economics professor Richard V. Burkhauser examined the effects this had on poverty levels in those states. The result shows that there was no difference in poverty levels in those states pared to states with lower minimum wages.

Further, they calculated the effects of a proposed increase in the federal minimum wage to $9.50 on workers then earning $5.70 (or 15 cents less than the minimum in March 2008) to $9.49. They concluded that increasing the minimum wage from $7.25 to $9.50 per hour “will be even more poorly targeted to the working poor than was the last federal increase from $5.15 to $7.25 per hour.”

3.The minimum wage redistributes wealth from the low-skilled poor to the more skilled working poor and middle class— Many supporters of minimum wage increases mistakenly believe that increases in wage rates are transfers of wealth from employers and investors to the workers. But as Anthony Davis explains, the money to pay for the increased wage e from at least one of four places: higher prices for consumers, lower returns to investors, lower prices to suppliers, or a reduced work-force. Empirical research has shown that the primary effect of minimum wage increases is reduced employment, which essentially transfers the wealth (in unearned wages) from the less skilled to the more skilled working poor and middle-class teenagers.

4. Minimum wage increases disproportionality affect African Americans —Employment among African American males between the ages of 16 and 24 isdisproportionately responsive to the minimum wage. A ten percent increase in the minimum wage would reduce employment by 2.5 percent for white males between the ages of 16 and 24, 1.2 percent for Hispanic males between the ages of 16 and 24, and 6.5 percent for African American males between the ages of 16 and 24. Professors Even and Macpherson estimate that in “the 21 states fully affected by the federal minimum wage increases in 2007, 2008, and 2009,” young African Americans lost more jobs as a result of minimum wage hikes than as a result of the macroeconomic consequences of the recession.

Comments
Welcome to mreligion comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
RELIGION & LIBERTY ONLINE
How Christianity created the free society
While many Christians have undermined human liberty, says Samuel Gregg, the Director of Research for Acton, a new book of essays shows just how much of our contemporary freedom we owe to the Christian church, Christian thinkers, and Christian practice rather than liberals and liberalism. Any discussion of freedom and Christianity quickly surfaces the numerous instances in which Christians have undermined human liberty. Reference is invariably made to the various Inquisitions, the witch trials conducted by Puritans, forced conversions, and...
Utopias Denied: Arthur Koestler’s Darkness at Noon at 75
Arthur Koestler (1905-1983) “In the world of literature,” says Bruce Edward Walker in this week’s Acton Commentary, “perhaps only Aleksandr Solzhenitsyn did more to expose the lies and cruelty of 20th century totalitarianism.” What makes Darkness at Noon such an enduring artistic work is Koestler’s firsthand knowledge of his source material. Indeed,Darkness at Noon is an imaginative effort, but unlike The Gladiators – set in the first century B.C. and detailing the failed slave revolution led by Spartacus – and...
New book explores compatibility of Christianity and freedom
A new collection of essays titled Christianity and Freedom: Historical Perspectives edited by Samuel Shah and Allen D. Hertzke explores the ways that Christian beliefs and institutions have made contributions to the freedoms that are cherished by both Christians and non-Christians today. Acton Director of Research, Samuel Gregg, recently gave his analysis of this new collection of essays in a book review published at Public Discourse. Gregg begins his review by recognizing that while Christians have played a huge role...
Are libertarians too anti-pollution?
“There are no solutions,” says economist Thomas Sowell. “There are only trade-offs.” Sowell’s claim is especially true when es to the issue of pollution. We have no solution that will allow us to eliminate all pollution, so we are forced to make trade-offs, such as exchanging a certain level of pollution for economic growth. What would happen, though, if we allowed our political presuppositions to determine which side of the tradeoff we must always choose? That’s the question at the...
Love is the Truth
This ad perhaps captures Deirdre McCloskey’s observation that “love runs consumption” better than anything I have yet seen. Coca Cola – What Goes es Around from THE APA on Vimeo. And embedded in Jack White’s song are some rich theological insights. For more on the backstory for the song and the ad, check out this piece at the Consequence of Sound. ...
Which religious tradition is most conducive to economic freedom?
There are many factors that account for a country’s economic freedom (or lack thereof), but one ofthe most overlooked is the role of religion. Can economic freedom be explained by religion, independently ofpolitical institutions? That’s the question researchers at an economics think-tank in Germany attempted to answer. Their findings: Weinvestigate whether religion affects economic freedom. Our cross-sectional dataset includes 137countries averaged over the period 2001-2010. Simple correlations show that Protestantism isassociated with economic freedom, Islam is not, with Catholicism in...
Economic growth lifted another hundred million people out of extreme poverty
The number of people living in extreme poverty continues to decline, notes a report released yesterday by the World Bank. In 2013, the year of the prehensive data on global poverty, an estimated 767 million people were living below the international poverty line of $1.90 per person per day. This is a decrease of about 100 pared with 2012. The decline is primarily attributed to the reductions in the number of the extreme poor in South Asia (37 million fewer...
‘You are the spring that puts all the rest in motion’
By Jacques Reich (undoubtedly based on a work by another artist) – Appletons’ Cyclopædia of American Biography, 1900, v. 5, p. 438, Public Domain, “You are the spring that puts all the rest in motion; they would not stir a step without you.” John Wesley (1703–1791) was talking about the slave trade and was impugning the buyers and owners of slaves as equally culpable as those who captured and sold them, those who “would not stir a step” without buyers...
Explainer: What you should know about the Trans-Pacific Partnership (TPP) trade accord
In the recent presidential debate, Donald Trump and Hillary Clinton disagreed on nearly everything. But there is one thing they both oppose: the Trans-Pacific Partnership (TPP). Here is what you should know about the agreement and why it matters in the election. What is the Trans-Pacific Partnership? Five years in the making, the Trans-Pacific Partnership (TPP) is a trade agreement between the United States, Australia, Canada, Japan, Malaysia, Mexico, Peru, Vietnam, Chile, Brunei, Singapore, and New Zealand. The twelve countries...
Does the New Testament say wealth is intrinsically evil?
In a recent article in Commonweal, the Orthodox theologian David Bentley Hart responds to a rebuttal article written last year by Acton research director Samuel Gregg. Hart say that “on at least one point Gregg did have me dead to rights: I did indeed say that the New Testament, alarmingly enough, condemns great personal wealth not merely as a moral danger, but as an intrinsic evil.” What is Hart’s basis for the claim? That he can read thekoineGreek. He believe...
Related Classification
Copyright 2023-2025 - www.mreligion.com All Rights Reserved