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Fall Into the GAP

Somewhere in a box I have a GAP store credit card.  I haven’t used it in years.  However, I just might have to go look for it.  You see the GAP has raised the minimum wage for its employees to $10 an hour.

I know what you are thinking, “Abdul, you are not a fan of increasing the minimum wage.”  No, I am not a fan of government mandated increases in the minimum wage.   What the GAP did is what I believe in, private sector employers making the decision to increase the wages of their employees.

It’s one thing to increase the minimum wage in a booming economy, but in an economy like ours, such mandates are just asking for trouble.

We have already seen the Congressional Budget Office report that has said raising the minimum wage would cost 500,000 jobs and hurt the very people that progressives allegedly are trying to help.

If an employer can figure out a way to pay his or her employees more without hurting the bottom then they should be applauded.  However, that increase in hourly wages will have to come from somewhere.  So the GAP has decided it will either raise its prices, cut back hours or scale back profits for its shareholders.  Regardless, it is the GAP’s decision to make and not one that should be forced on it by the government.

Regardless, I have to give the GAP credit for taking the initiative, now I have to go figure out where I put that card.  It’s probably in the same place where I keep my Starbucks gift cards.


  • Mike

    Wait, it would cut 500K jobs but lift 900K people out of poverty according to the estimates. There are plenty of good arguments that we shouldn’t raise the minimum wage, but it’s disingenuous to quote one number out of that report when the other three showed much more positive impacts.

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  • Paul Hill

    I’d prefer you talk about the 8 homicides last night.

  • malercous

    Directly raising the wages for 16.5 million vs .5 mil lost jobs = 32 to 1. And just what kind of business has “extra” employees they’d fire? Also, why do the overwhelming majority of economists support raising the min. wage? Even the retrograde state of MO has a min wage higher than the federal level.

  • Callan

    Well, it doesn’t seem to be hitting the folks, predominately, it purports to be looking to help. From the report https://www.cbo.gov/publication/44995: “The increased earnings for low-wage workers resulting from the higher minimum wage would total $31 billion, by CBO’s estimate. However, those earnings would not go only to low-income families, because many low-wage workers are not members of low-income families. Just 19 percent of the $31 billion would accrue to families with earnings below the poverty threshold, whereas 29 percent would accrue to families earning more than three times the poverty threshold.”

    The low wage workers in question tend to be the kids of middle class families, who (arguably) are benefiting from being employed and learning a work ethic.

    To help the middle-low incomes, a simple payroll tax adjustment might do the trick here…