Home
/
RELIGION & LIBERTY ONLINE
/
How Four States Voted to Hurt Low-Skilled Workers
How Four States Voted to Hurt Low-Skilled Workers
Feb 26, 2026 3:53 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
The connection between property rights and religious freedom
According to Founding Father James Madison, “the rights of persons and the rights of property” constituted the “two cardinal objects of government.” And the “most sacred form of property,” according to Madison, was an individual’s conscience since “other property depending in part on positive law, the exercise of that, being a natural and inalienable right . . .” Both property and conscience (religious freedom) have been considered foundational rights. But what exactly do they have mon? More than we may...
Radio Free Acton: Mollie Ziegler Hemingway on fake news; Upstream on Fleet Foxes and R.E.M.
In this newest edition of Radio Free Acton, Mollie Ziegler Hemingway, senior editor at The Federalist, talks with Sarah Stanley, managing editor at the Acton Institute. Mollie explains how distrust for news in the media has grown and how integrity in journalism can be reclaimed. Mollie’s conversation with Sarah is a sampling of an ing Acton lecture series event taking place on September 28th. Bruce Edward Walker then speaks with writer and musician, Robert Dean Lurie about the newest Fleet...
Redemption Camp: A Nigerian megachurch builds its own city
As urbanization accelerates around the world, local municipalities and city planners are struggling to keep up with the pace. Sometimes and in some areas, it’s easier to work outside the government altogether. Such is the case for the Redeemed Christian Church of God in Lagos Nigeria, which has slowly developed a city of sorts over the past 30 plete with an independent power plant and privately managed security, infrastructure, and sanitation. “In Nigeria, the line between church and city is...
Czeslaw Milosz: Poet Laureate of Freedom
[A review of Milosz: A Biography by Andrzej Franasszek, edited and translated by Aleksandra and Michael Parker, The Belknap Press of Harvard University Press, Cambridge University, 2017, 526 pp., $35] “What is poetry which does not save/Nations or people?” – Czeslaw Milosz (“Dedication”) In the 1970s – the last full decade before Poland finally freed itself from the shackles munist control –Lech Walesa, the leader of Solidarity, the Soviet bloc’s first trade union, was arrested on more than one occasion....
Why we should reject the erroneous idea that ‘error has no rights’
A recent poll revealed that a near majority of Americans believe free speech should not be extended to extremist groups. Another poll found that a large number of citizens favor permitting the courts to fine news media outlets for publishing or broadcasting stories that are biased or inaccurate. (Almost half of Republicans (45 percent) would favor such a policy, and 35 percent say they simply haven’t heard enough to say.) And in Russia, the government has banned the religious group...
Booth: This reform would improve the ecological, and human, environment
To be good citizens, faithful people must examine policies’ results, not just their intentions.One overly intrusive environmentalist policy alone has prevented the poor from accessing adequate housing and, ironically, reduced the diversity of the environment. If excluding the vulnerable from the economy is evil, as Pope Francis has written, then new approaches are needed, writesPhilip Booth,a distinguished British professor of finance in a new essay forReligion & Liberty Transatlantic. He begins by opening an earnest dialogue with the pontiff’s social...
How much does crime pay?
The claim that “crime doesn’t pay” was an early slogan of the FBI. But while the claim may be a truism in the long run, in the short-term criminal activity can produce an parable to the earnings of a middle-class worker. At least that’s the finding of a new paper published in the journal Criminology. Holly Nguyen of Pennsylvania State University and Thomas Loughran of the University of Maryland-College Park attempt to gauge how much money people earn through criminal...
Samuel Gregg: ‘First Things,’ R.R. Reno, and the market economy
The role of free market economics in the West should not be off-limits for debate among religious conservatives. As Samuel Gregg writes in a new essay, that standard should “provide philosophical and theological guidance about how to ground free economies—and liberal institutions more generally—upon more solid foundations than the peculiar mixes of utilitarianism, autonomy-for-autonomy’s sake, and pseudo-evolutionary theory advocated by some liberal thinkers.” In a new article, First Things editor R. R. Reno makes claims about the market economy and...
Rev. Robert Sirico praises President Trump’s recent remarks about Venezuela
President and Co-Founder of the Acton Institute, Rev. Robert Sirico is quoted in an article published at Crux, praising President Trump for his remarks concerning Venezuela’s current social and economic state of chaos. “The problem in Venezuela is not that socialism has been poorly implemented, but that socialism has been faithfully implemented,” said Trump on Tuesday in his first address to the General Assembly of the United Nations. Sirico tells Crux that he was “relieved and encouraged to hear President...
The costs and benefits of monopoly
Note: This is post #49 in a weekly video series on basic microeconomics. What would happen if we eliminated patents for industries with high R&D costs, such as the pharmaceutical industry? Eliminating patents in this case may result in less innovation and, specifically, fewer new drugs being created, explains economist Alex Tabarrok. In this video by Marginal Revolution University he considers some of the tradeoffs of patents and looks at alternative ways to reward research and development such as patent...
Related Classification
Copyright 2023-2026 - www.mreligion.com All Rights Reserved