The Florida governor is using California’s $15 minimum wage as an opportunity – to lure companies to the Sunshine State.
“Ready to leave California? Go to Florida instead – no state income tax, and Gov. Scott has cut regulations,” an ad running in Los Angeles and San Francisco stated.
The ad is part of a push from Governor Rick Scott to boost Florida’s economy, according to WWSB.
It’s also establishing the groundwork to oppose a similar $15 hourly minimum wage in Florida.
The median hourly wage in California is $19.15, according to the Bureau of Labor Statistics.. The minimum wage is $10, but will jump to $15 by 2022, thanks to recent legislation. That will pull the median-to-minimum ratio from 52 percent to 78 percent. The median wage tends to increase, however. Assuming the median wage increases by 2.67 percent, the average yearly growth between 2011 and 2015 according to data from California’s Employment Development Department, that ratio will be 66 percent by 2022.
The higher the ratio, the narrower the labor market is. Employers are legally barred from hiring workers with a lower marginal productivity, unless they “informally” hire them off the books.
In Florida, however, the median hourly wage is only $15.29. The minimum wage of $8.05 means the state has a similar ratio to California of 53 percent. Were Florida to adopt a $15 minimum wage, its ratio would skyrocket to 98 percent. High cost-of-living areas can absorb a higher minimum wage with fewer negative effects. Job losses are more marginal. If lower cost-of-living areas adopt it, the job losses can be deep and lasting.
The danger of the minimum wage debate is that proponents have shown a cavalier disregard for the economic impact of raising the minimum wage. That mindlessness ignores the unseen effects of higher business costs and the threat of job losses. Costs accumulate, and the overall effect can hurt more workers than it can help.
The South has been more averse to the push for raising the minimum wage. South Carolina rejected a bill to push the minimum wage to $15, citing the threat of job losses. For good reason, too. Burdensome regulation has cost the American economy trillions in economic growth. The arbitrary $15 minimum wage, driven on the state level with no regard for median wages across local and regional economies, has far-reaching and unseen consequences.
