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Tuesday, July 22, 2008
Will minimum wage increase backfire?
The Atlanta Journal-Constitution
“The federal minimum wage will rise to $6.55 an hour on Thursday, the second of three annual 70-cent increases passed by Congress last May. With housing markets collapsing, financial markets in disarray and the economy at a standstill, what may have been a reasonable plan a year ago seems ill-timed today,” writes an associate professor of economics in an opinion column today.
It can be argued, she writes, that surging grocery and gas prices make it especially important to help low-income families.
But higher minimum wage isn’t going to help people who can’t find a job because employers have cut their payrolls, she writes in part. She believes it is better to focus on giving firms tax incentives to hire low-skilled workers and then using the Earned Income Tax Credit to boost the earnings to boost the earnings of such workers to help low-income families.
Do you believe the minimum wage increase will backfire?
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