This just in, an increase in a minimum wage somewhere was followed by a decrease in job creation. The somewhere is Washington DC. I know, to most of you this is not surprising. While comparing the 12 months after and before the minimum wage hike the article points out that in the...
... year-long period after the first wage increase, employment in all other District industries grew by 1.9 percent. Jobs in higher-wage industries, where the minimum wage is less relevant, thus dramatically outpaced those in the leisure and hospitality sector, where growth was negative 0.1 percent.Don't y'all cheer at once. Raising the minimum doesn't instantly transmute low-skills-low-pay workers into mid- or high-skills workers. But what was the job growth rate in the 12 months before the minimum wage rise?
That is not the only comparison worth considering. In the 12 months before D.C. raised its minimum wage, jobs in the leisure and hospitality sector grew at a healthy rate of 2.2 percent. After the city government raised the minimum wage, employment growth in this sector turned negative.So from 2.2 to -0.1 and the only macroeconomic change was a shift in minimum wage. That could be incorrect. There could be another big change in the DC area of sufficient magnitude to expplain this massive negative turnaround low-skill job creation.
In other news, apparently the central transport planners can't plan transport effectively. Economic calculation without market prices is vastly more difficult than with. Who'd a thunk it, amirite?
This article demonstrates that the political mode of production and bureaucratic mode of distribution cannot accurately allocate resources in order to meet consumer demands.