Minimum Wage Should Be $3.83

Why $3.83 you might ask? Well, I arrived at that exact number through the same rigorous analysis used by anyone who proposes a minimum wage:

I just pulled a random number out of my head.

But my minimum wage proposal has a distinct advantage over most others in that it is set below where the natural floor for wages would likely be. Frankly, I think just about anyone in the job market would be making more than $3.83, so my minimum wage won't do anyone any real good by progressive standards. But, more importantly, it won't do anyone any harm. 

That's the point. And in reality, it will do a lot of good.

Minimum wage is an entry level wage. Most people don't stay at entry level wages for long periods of time. Why? Because you gain skills that make you more valuable than an entry level person. And you make more money that way.

Raising the minimum wage doesn't help anyone. Not a single person. Employers are only going to be willing to pay someone for their labor what their labor is actually worth. If you raise the minimum wage to $15.00 an hour, no one is going to look at their workforce and simply acquiesce to the superior wisdom of government and raise all wages. They will keep those employees that can deliver $15.00 in value and let the rest go.

When I first entered the workforce, I was not worth $10.00 an hour. I don't think I was worth $5.50 an hour. But that first job gave me real experience which I was able to leverage into another job and another and another. 

Honestly, is a 16 year old with no experience worth $10.00 an hour? Of course not.

But that is the beauty of a capitalist system. As skills grow, so does income. If that wasn't the case, why wouldn't all employers simply race to the bottom? Why not pay the minimum wage, currently $7.25, to every single employ since that would obviously be the cheapest route? Well, if you were paying all your employees minimum wage, I'd take a look at the most skilled ones and swoop in to offer them a higher wage and steal them away. And thus it would go until employees are making their market value. Smells like sweet competition.

So what would it mean to raise the minimum wage? We'd essentially be pricing certain people out of the labor market. That cashier at McDonald's can easily be replaced with an iPad. The kid getting his start by cleaning restrooms and sweeping floors? Replaced by someone far more experienced who will now be doing those things along with a host of others.

So if we want to increase unemployment, especially among the young and less skilled, raising the minimum wage is the fastest and best way to do it. If, however, we're interested in giving everyone a chance to work and gain skills to succeed in life, I'd say $3.83 is a great place to start.