In an article from last year issued by the Brookings Institution that is being recirculated by the think tank in response to current events, Harry J. Holzer argues that the $15-an-hour minimum wage being demanded by activists and imposed in some jurisdictions is too high:
In job markets where young or less-educated workers already have difficulty finding jobs and gaining important work experience, such mandates will likely make it much harder.
In a city like Washington D.C. where unemployment among those with a high school education or less is at a worrisome 15%, jobless rates will almost certainly rise. Many employers will be very reluctant to pay high wages to workers whose skills – including the ability to speak English, in the case of many immigrants – are so modest. A likely result would be not only increases in unemployment but also drops in formal labor force activity (where workers work or search for legal jobs) and perhaps some growth in undocumented work among immigrants....local increases of this magnitude will generate big incentives for employers to move across local borders, especially from central cities to suburbs. For instance, if Washington, D.C. raises its minimum to $15 (after it is already scheduled to rise to $11.50 in 2016) while Arlington, Virginia remains at $7.25, the incentives for employers with many low-wage workers to shift places of business from the former to the latter will be quite strong.
This is the center-left Brookings, not Cato or Heritage. Professor Holzer served as chief economist of the Department of Labor during the Bill Clinton presidency.
