Randy Daly: Ballot Measure 1 is a bad idea. Here’s why
Originally Published in Must Read Alaska: https://mustreadalaska.com/randy-daly-ballot-measure-1-is-a-bad-idea-heres-why/
Ballot Measure Number 1, an act increasing the minimum wage in Alaska, does not get much discussion, which may lead to it passing, and that would be a bad thing for Alaska.
As an Alaskan business owner, I know firsthand that increasing expenses without an increase in value to the consumer leads to price increases for customers. Alaskans have experienced a 20% increase in consumer prices over the last four years.
Ballot measure 1 is a poorly timed bad idea. But hey, don’t take my word for it, there are many wiser and well qualified folks like Thomas Sowell, Tim Harford, and Charles Wheelan who all agree:
Thomas Sowell, the famous economist and author of Wealth, Poverty and Politics, opposes raising the minimum wage because he argues that it leads to higher unemployment, especially for low-skilled workers. According to Sowell, minimum wage increases make it more costly for businesses to hire employees, which often leads them to reduce hiring, cut hours, or even lay off workers.
These policies can be especially detrimental to young and minority job seekers, as they may find fewer entry-level opportunities. Sowell suggests that market-based wages are more effective in promoting economic growth and improving overall employment rates.
Tim Harford, who wrote The Undercover Economist, opposes raising the minimum wage due to concerns about job loss and economic inefficiency. He argues that minimum wage increases often result in reduced employment opportunities, particularly for young and low-skilled workers. Harford emphasizes that wage floors interfere with market dynamics by distorting the natural balance between supply and demand for labor. This interference can lead businesses to cut back on hiring or to replace workers with automation.
Harford contends that such policies can ultimately harm the individuals they aim to help, as they reduce overall economic efficiency and job availability.
Charles Wheelan, author of Naked Economics, argues that raising the minimum wage can have unintended consequences that may harm those it aims to help. Wheelan believes that if the minimum wage is set above a worker’s marginal productivity (the value they bring to their job), businesses might respond by cutting jobs or automating roles to reduce labor costs. He also emphasizes that wage hikes can lead to fewer entry-level opportunities, which are crucial for unskilled workers to gain experience.
Instead, he suggests focusing on policies that enhance worker skills and productivity, addressing poverty more effectively without risking job losses.
Sowell, Harford, Wheelen, and I agree, increasing wage without increasing economic output, measured in quality, quantity, speed, or a combination of these things, creates higher prices, reduces economic efficiency and risks job loss.
These guys know what they are talking about. You might say they wrote the book on it.
Ballot measure 1 is a poorly timed bad idea. Vote no on Ballot Measure 1.
Thomas R. “Randy” Daly is originally from Tok and now lives in Kenai. A graduate of East Anchorage High School and University of Alaska Anchorage, he is a former Marine, E Company 4th Recon., 4th Mar. Div., Elmendorf AFB; Communications Chief, Airborne, SCUBA, WSSI; Founder / Owner HiSpeed Gear! Inc.; former owner of a statewide business equipment dealership founded in 1998; former producer of Tom Randell Daly’s Show on KWHQ FM / Host on Sound Off KSRM AM; founder of Randy’s Garage, car sharing service founded in 2020; past president, Alaska Film Group; past president, Rotary Club of Kenai / Paul Harris Fellow; past president, Kenai Peninsula Economic Development District Board; married to his high school sweetheart and is the father of two.