Excellent question posed over at Seeking Alpha regarding the recent increase in the jobless rate:
Is the Minimum Wage Increase Behind the .50% Jobless Rate Jump?
Accoding to BLS data on unemployment rates by age, it looks like almost all of the .50% increase in May unemployment to 5.5% from 5% in April was due to increases in the jobless rates for young workers in the 16-24 year age group, especially the 16-19 year group (see chart above). For workers 25 years and over, the jobless rate has remained pretty stable at around 4%, compared to large increases from April for 16-19 year workers (+3.3% to 18.7%, the highest rate since 1993) and 20-24 year olds (+1.5%).
Although it apparently hasn't received much media attention, perhaps there is a link between the rising unemployment rate for teenagers and the pending 12% increase in the minimum wage next month. Since we have evidence that consumers respond to higher gas prices by driving less, wouldn't it also be the case that employers of unskilled workers would respond to 12% increases in wages for unskilled workers by hiring fewer unskilled workers?
Of course, any good Leftist would tell you that minimum wage increases don't result in unemployment because business just eats the additional costs.
Of course, any economist could've told everyone that this was going to be the result - and many did.
ARC: St Wendeler