Complicated question, love to hear long responses.
I think most of us would notice next to nothing. Of the hourly workers in the US, minimum wage earners account for less than 5%. My guess is that for those 5% very little would change. The question, I think, is how much do those above minimum wage owe their wages to the existing floor beneath them? Without that floor does pay go down for all hourly wage earners as a result of it's demise?
They are already making as little as the law allows. Surely if the law were removed, at least some of those 5% will begin making even less.
I suspect it would do nothing much for most workers, as you say - but it would be a kick in the nuts for those 5%, not "very little change".My guess is that for those 5% very little would change.
Most people making minimum wage would probably see a pay cut, and in time, social programs would see a similar increase in need. I would not work for minimum wage. It's not worth my time. It's really not worth anyone's time that doesn't have an additional income stream supporting them. Trying to live on minimum wage for an extended period will only push you into debt.
Okay. What I was essentially wondering is this: would the current labor surplus act in such a way that, when labor was exogenously exposed to a competitive or pseudo-competitive market under 7.25, the price of labor would drop, and if so, to where. Also, would the mechanism be a sweeping hiring of illegal immigrants, or would it simply be an ultimatum: "take a pay cut or walk." (Most likely both.) It also seems just possible to me that the longterm human capital PR benefits of not touching your company's wage level even when legally allowed to do so would result in very little functionally changing. That's probably extremely naive. -- And how would unions factor in? How many unionized workers are paid anything close to minimum wage? Would they be affected even though they aren't making 7.25? thenewgreen raises that question above:The question, I think, is how much do those above minimum wage owe their wages to the existing floor beneath them? Without that floor does pay go down for all hourly wage earners as a result of it's demise?