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Higher Minimum Wage

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When California Governor Jerry Brown announced his plan to be the first state to raise the minimum wage to $15 an hour, lots of people had an opinion. Dr. Merrill Matthews (a frequent guest on Point of View) summarized his thoughts this way. “As a Texan, let me say, ‘Thank you, Governor Brown!”

He pointed out that Texas has benefited from the Golden State’s determination to send its best employers and jobs to the Lone Star State. He believes that this announcement will assure that the relocation efforts will continue for years to come.

In case you are wondering, the number of Californians moving to Texas has hit its highest level in nearly a decade, according to the IRS. It compiles migration data by looking at the address changes in the tax forms. Many of these people may be leaving for better job opportunities or fewer regulations. But increasing the minimum wage in California will also hasten the flight from the state.

Talk show host, Dan Celia predicted that there would be lots of bankruptcies throughout California by 2022. He couldn’t believe that politicians in California wanted to do this in light of previous experiences elsewhere. Perhaps, he speculated, that politicians thought “what happened in the state of Washington was just some sort of weird anomaly that is not going to happen anywhere else in the world.” He reminds us that fast-food chains had to lay off people and start pushing for more automation systems. He is sure that there will be fewer people working as a result of the $15 an hour wage.

Of course, some workers will benefit because they will see their wages jump from $10 an hour to $15 hour. Others will be laid off, but it won’t stop there. People working for $12 an hour who have seniority won’t be happy making $15 an hour, the same wage as someone new to the job. So they will demand a higher wage. In the end, wages might go up, but job opportunities will go down.

Viewpoints by Kerby Anderson

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