The “living wage” movement in the United States supports local, state and even federal legislation to mandate a much higher minimum wage, presumably tied to the cost of living or the wage required to lift a one-earner family above the poverty level.
While some biased research shows that wage mandates have no ill effect on employment, most economists and most research suggest quite the opposite. A survey of some 360 labour economists across the United States found that:
Employers facing increased labour costs through local living wage mandates would be forced to pass those costs along to consumers, most likely in the form of higher prices for products and services, says the James Madison Institute. As a result, consumers would shop in neighbouring communities or states where arbitrary wage mandates do not exist and, hence, prices are lower.
For Florida, the study recommends state legislation to prevent local jurisdictions from creating wage “zones” and mandating arbitrary levels of pay in those zones.
Source: Gary Landry, The Living Wage Movement and Its Implications for Florida, Policy Report No. 38, March 2003, James Madison Institute.
For text http://jamesmadison.org/files/publications/97.pdf
For more on the Living Wage http://www.ncpa.org/iss/eco/
Policy Bulletin/22 April 2003
