Impact of Minimum Wage: Black Teens


Last month I posted about the minimum wage and it’s impact on teens.  Back then, I commented on how a post by Mark Perry over at Carpe Diem pushed me to finish my data analysis.

The results were drastic.  And now, I wanna show the same analysis but for black teens in America.

So, the concept is a simple one.  Measure the unemployment as minimum wage goes up.  However, there are many reasons why unemployment might go up or down, so the technique is to gauge how it impacts a segment of the population.  And to do that, you subtract the unemployment rate of that segment from the unemployment rate of the population as a whole.

For example, if the National Unemployment rate is 6.5% but the teen unemployment rate is 10%, you could say that the excess teen unemployment is 3.5%.

So, here’s the data for the Excess Black Teen Unemployment:

Again, we see the impacts pretty clearly here..  The pattern generally holds as compared to the overall numbers for teens in general; in the boom of the mid 90’s, the gap lowered even as the minimum wage went up.  Times were good.

However, look at the numbers recently.  As the national unemployment rate hit 10%, black teen unemployment hit nearly 50%!  1 in 2 black teens was unemployed during this period!  The unemployment rate for all teens was 26.8%.  And for white teens?  It was 23.0%  Black teens were more than doubly impacted by the minimum wage increase than white teens.

The very people who the law is intended to serve wreaked havoc on them.

With friends like these, who needs enemies?

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2 comments
  1. Sandy Parker said:

    I don’t get it. Why was raising minimum wage ok in the 90s but not ok in ’09? Also you say there are many factors involved but the lay the blame on minimum wage, when a lot has been written about over-qualified adults and recent college graduates taking up what few post-recessions jobs are available. I fear that minimum wage doesn’t help full employment but right now we need a shot in the arm here, and people who would benefit from min wage will spend the money, unlike the main benefactors of whatever recovery we’ve had, the wealthy, who save their money. Spending makes the economy go.

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