Show THE VOICE OF BUSINESS Maximum Sense Needed On the Minimum Wage DY fly ARCH ARCU N N. N BOOTH executive vice president of ot the Chamber of ol Commerce of ot the thC United States Can you ou imagine your our congressional representatives voting for lor a n bill to make it harder for black teenagers to get job jobs jobs' No Well then how about imagining Imagining ing them voting for tor a bill to increase rural unemployment I SOUNDS MOST unlikely doesn't It Well the trick Is you OU call the bill a abill abill I bill to raise the minimum wage rate Then everybody can vote for tor it with a n clear conscience because everybody likes to get et a n raise The problem is that while Congress can cnn require an employer to pay his employees employees em more money it cannot create the money to pay them with And employers employers em have hav money problems just like employees So when an ar employer is forced for ced to pay more money than Utan a job l' l Is Ls worth he simply eliminated the job lie Ire has to Otherwise hed he'd go broke himself Obviously the first jobs to go are the low pa ing jobs And the paying low jobs Ire are those that require the least skill the jobs that are arc usually first jobs for teenagers and school dropouts Low paying Low paying jobs are Ire not ideal but they are better than no job at all Also they may enable the jobholder to upgrade upgrade upgrade up up- grade his skills while he works so he can advance ance to high paying high paying work WHEN THESE jobs arc are not available the person who vho is for higher higher- skilled work may be forced onto wel wel- fare Or he may be tempted to try crime In rural areas area living costs are arc not as high as in the great urban centers Pay is h u usually correspondingly lower too But when Congress raises the minimum wage rate or extends its coverage ge to new occupational groups grouns it applies equally equally ally everywhere in the country As S the low low paying paying jobs in rural areas are eliminated rUminated the unemployed often turn to the nearest big city in hopes of finding find find g ing a I job there The effect of all of these factors is to aggravate the social problems of the big cities And that places a n further burden on both local and federal budgets Unemployment amon among the 19 1619 year year- olds is very low now now about about 25 per cent That breaks down to per cent for whites whiles and per cent for blacks But believe it or not Congress is considering considering con conn increasing the minimum wage from lIfo lb an In hour to an hour right away and to a n year later IN THE past whenever the minimum wage has gone up so has teenage There Is s every reason to expect expect ex ex- that history will repeat itself this time So what do we do about all aU those unemployed teenagers Well Congress may have an In answer for that too The government is being asked to spend million on the Neighborhood Youth Corps to create jobs for them at It the taxpayers taxpayer's expense expense By increasing unemployment higher minimum 1 wages rates may also have an In indirect effect on inflation What happens is that the Federal Reserve System worried worried wor wor- ried by the Uw unemployment rate increases increases in in- creases the money supply faster than economic conditions warrant to stimulate stimulate sUm sUm- the economy And the Fed has in fact been doing just that BUT THERE is a time Ume lag Ilg of several months between an In expansion of the money supply and the desired the live effect Therefore If Ir the economic recovery continues to gain momentum the Zeds Ted's boost may be felt at It a n time when hen the economy Is again at nt full lull capacity And that means menns more inflation How much simpler things would be he if It Congress realized that this Is just not the time for a big Increase in the minimum wage |