Some Maine Republicans have come under attack from progressive and union groups for a proposal (pdf) to curtail some child labour laws or as progressives put it, to wage “war on child labor laws”.
Ignoring politics, lets make a simple economic analysis. Minimum wage laws cause unemployment, especially for younger people. By setting a minimum wage above the equilibrium price in a labour market, the result is a surplus of labour, i.e. quantity supplied exceeds quantity demanded. This means that employers will not hire as many employees at the government mandated wage. (See image above)
Think Progress goes on to claim:
Burns’ bill is particularly insidious, because it directly encourages employers to hire children or teenagers instead of adult workers. Because workers under 20 could be paid less than adults under this GOP proposal, minimum wage workers throughout Maine would likely receive a pink slip as their twentieth birthday present so that their boss could replace them with someone younger and cheaper.
This claim is very blunt, and lacks economic backing. Adult workers typically have more work experience and more education than teenagers, which is why adults earn higher wages than teens. So really this nothing more than hyperbole, not a form of economic reasoning.
There is nothing wrong with letting young people, willing to work, bid down wages so they can gain valuable work experience.
