High Minimum Wage Impact 12-22-25

In 2025, economic research on higher minimum wage impacts on teen employment shows conflicting views: some analyses, like one from MinimumWage.com, suggest wage hikes lead to higher teen unemployment by reducing entry-level jobs, while other studies, as noted by the EPI, find significant positive impacts on affected workers' earnings with minimal job loss, and some suggest moderate increases have minimal impact. While some argue higher costs force businesses to cut jobs (especially in retail/restaurants), others point to increased worker spending and improved health, with newer data showing varied effects, though many studies point to negative outcomes for teen jobs.  

Arguments for Negative Impact on Teen Employment

Reduced Entry-Level Jobs: Studies suggest higher minimum wages decrease job opportunities for teens, making it harder for them to get their first job and build skills.

Business Cost Increases: Higher wages increase labor costs, potentially leading businesses to reduce staff or automate tasks (like replacing cashiers with kiosks).

Empirical Findings: Some analyses, including a 2025 regression study, link minimum wage increases to higher teen unemployment, citing research from multiple universities. 

Arguments for Minimal or No Negative Impact

Minimal Disemployment Effects: Research suggests moderate minimum wage increases have at worst minimal negative effects on overall employment, including for teens.

Increased Worker Spending: Higher wages put more money in the hands of low-wage workers, boosting consumer spending and potentially creating jobs.

Health & Well-being Benefits: Minimum wage increases are linked to better health outcomes and reduced mortality, offering broader societal benefits. 

The 2025 Context

State-Level Increases: Many states implemented minimum wage hikes in 2025, affecting millions, with some analyses focusing on these state-specific impacts.

Federal Efforts: The proposed Raise the Wage Act of 2025 aims to incrementally raise the federal minimum wage to $17 by 2030, which the Economic Policy Institute (EPI) projects would boost wages for over 22 million workers. 

Overall Picture
The impact of minimum wage hikes on teen employment remains a complex, debated topic, with some data showing negative consequences for entry-level roles and others highlighting broader economic and health benefits, suggesting effects vary depending on the magnitude of the increase and local economic conditions. 

In 2025, the impact of higher minimum wage increases on teen employment remains a subject of debate between different economic schools of thought. While many states implemented significant hikes in 2025, the overall effect on teens is characterized by a "trade-off" between higher earnings for those employed and potential barriers for those seeking entry-level roles. 

Current Impacts on Teen Employment (2025)

Mixed Employment Rates: Some 2025 analyses indicate that statistically, minimum wage increases continue to lead to slightly higher teen unemployment rates as businesses adjust to increased labor costs.

Reduced Turnover and Stability: Conversely, research from 2025 suggests that these increases have substantially reduced turnover and increased job stability for the "highly affected" teen group.

Shift in Work Hours: In some regions, higher wages have allowed teenage employees to work slightly fewer hours while focusing more on education, without necessarily losing their jobs.

Increased Competition and Automation: Businesses facing higher costs may prioritize experienced workers over entry-level teens or invest in automation (such as self-service kiosks), which can reduce the number of traditional "first job" opportunities. 

Key 2025 Wage Data & Trends

Widespread Increases: On January 1, 2025, a record 88 jurisdictions (including 21 states and 65 cities/counties) raised their minimum wage floors.

Federal Proposals: The Raise the Wage Act of 2025, introduced in April, proposed raising the federal floor to $17 by 2030 and gradually eliminating subminimum wages for youth and tipped workers.

State-Specific Examples:

Michigan: Raised its minimum wage to $12.48 in February 2025, with plans to reach $15.00 by 2027.

Washington & California: Cities like Renton, WA, and various California jurisdictions reached or exceeded $20.00 per hour for specific industries (e.g., fast food, hotels). 

Economic Perspectives

The "No-Loss" Argument: Advocacy groups and certain academic studies argue that higher wages boost consumer spending, which in turn creates more demand and jobs, offsetting the higher cost of hiring.

The "Job-Loss" Argument: Groups like the Congressional Budget Office (CBO) and conservative think tanks maintain that reaching a $15 federal floor by 2025 could result in roughly 1.3 to 1.4 million fewer jobs nationwide due to increased business costs and price hikes. 

These analyses examine the economic arguments around minimum wage increases, focusing on projected impacts on teen employment and wages.

https://www.google.com/search?q=Have+higher+minimum+wage+increases+impacted+teem+employment+2025

Norb Leahy, Dunwoody GA Tea Party Leader