Early in the Great Depression, President Herbert Hoover made things worse by persuading big businessmen to keep wages high. At those high wages, employers wanted to employ fewer people than otherwise. We are about to suffer another small dose of Hoover economics. Economist David Neumark points out in today's Wall Street Journal that the federal minimum wage will rise from $6.55 now to $7.25 in July. Writes Neumark:
The best estimates from studies since the early 1990s suggest that the 11% minimum wage increase scheduled for this summer will lead to the loss of an additional 300,000 jobs among teens and young adults.