Opponents of minimum wage laws tend to focus their criticism on one particular adverse consequence: by artificially raising the price of labor, they reduce employment, particularly for the most vulnerable in society.
“Minimum wage laws tragically generate unemployment, especially so among the poorest and least skilled or educated workers,” economist Murray Rothbard wrote in 1978. “Because a minimum wage, of course, does not guarantee any worker’s employment; it only prohibits, by force of law, anyone from being hired at the wage which would pay his employer to hire him.
Though some economists, such as Paul Krugman, reject Rothbard’s claim, a recent study found the overwhelming body of academic research supports the idea that minimum wage laws increase unemployment.
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