Progressives constantly advocate for a higher minimum wage with the intention of helping out those who are in impoverished situations. However, their good intentions don’t negate the fact that the minimum wage is detrimental to the very people it is supposed to help the most — particularly the young.
Prager University explains in a new video that it’s natural for people to earn different wages since, by nature, people have different skills and abilities that are valued differently, but the minimum wage undermines that basic economic principle and ends up hurting low-skilled, less experienced employees.
“Let’s say you own a home with a large lawn and there are several teenagers in the neighborhood interested in mowing that lawn,” the video states.”You might pick the one who will charge the lowest price, or Ned…well, because he asked first. Because the skills needed to mow the lawn are pretty basic, you’re confident the job will be done to your satisfaction.”
But if the government forces you to provide a higher wage, that would endanger Ned’s employment.
“You might simply decide to start mowing the lawn yourself, or you might become a lot pickier in deciding who gets the job,” the video states. “You may switch to the person who does it with the most attention to detail, which isn’t Ned’s strong point. So now Ned is unemployed.”
This is what happens when the government implements a minimum wage, as it artificially inflates the cost of labor, and employers have to account for or pass on that cost – and that usually means less employment, particularly for the youth.
“It’s the lower-skilled workers — who may need the raise the most — who are out of the job and are often the ones hurt by the unintended consequences,” the video concludes.
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