EPI Supports Rhode Island Proposal to Expand Youth Minimum Wage

Points to research showing value of training wages that keep career pathways open
for young jobseekers

Washington D.C. – Today the Employment Policies Institute (EPI) announced support
for legislation that would greatly-expand the training wage in Rhode Island, to keep
career pathways open for young jobseekers. Rhode Island State Representative Kenneth
J. Mendonça is testifying before the House Committee on Labor today in support of
legislation he cosponsored that would cap the minimum wage for young employees under
20 years of age at $9.65. (The state’s current training wage law applies to
full-time students under age 19 who work at certain nonprofits and community
organizations, as well as 14 and 15 year-olds who work fewer than 25 hours in a
week.)

A series of minimum wage proposals from the Governor and state legislature would
raise Rhode Island’s minimum wage as high as $15 an hour. (The state’s wage floor
was increased in four of the last five years.) Most economists agree
(https://www.epionline.org/wp-content/uploads/2015/11/Nov2015_EPI_MinWageSurvey4.pdf)
that a minimum wage increase of this magnitude is counterproductive, and reduces
job opportunities for young employees. A study
(http://faculty.econ.ucdavis.edu/faculty/ahstevens/neumarkwascher94.pdf) published
in Cornell University’s labor economics journal found that training wages at the
state level can help cushion the reduction in job opportunities associated with such
minimum wage increases.

The press release
(http://www.rilin.state.ri.us/pressrelease/_layouts/RIL.PressRelease.ListStructure/Forms/DisplayForm.aspx?List=c8baae31-3c10-431c-8dcd-9dbbe21ce3e9&ID=12696)
announcing Rep. Mendonça’s testimony cited EPI’s perspective on how high minimum
wages have consequences beyond just the loss of a paycheck for young jobseekers.
These consequences extend to the lost opportunity to learn soft skills that can only
be learned in the workplace and that set young employees up for future promotions
beyond the minimum wage.

This perspective is informed by a 2014 study by economists at the University of
Virginia and Middle Tennessee State University which found that early-career work
experience has meaningful and lasting benefits. Researchers found that part-time
employment in high school students’ senior year was associated with 20 percent
higher earnings later in their careers compared with their counterparts. Read the
full study here
(https://www.epionline.org/studies/the-lasting-benefits-of-early-work-experience/) .

«Short of shelving proposed minimum hikes altogether, expanding the youth training
wage is the least Rhode Island legislators can do to keep career pathways open for
young employees who need it most,” said Michael Saltsman, Managing Director at EPI.

https://ssl.gstatic.com/ui/v1/icons/mail/images/cleardot.gifFor more information,
visit EPIOnline.org
(http://bac.pr-optout.com/Tracking.aspx?Data=HHL%3d8%2b73%3b%26JDG%3c%3b0%3a232%3f%26SDG%3c90%3a.&RE=MC&RI=5078222&Preview=False&DistributionActionID=2909&Action=Follow+Link)
. To schedule an interview, contact Sean Kumnick at (202) 463-7650
(tel:%28202%29%20463-7650) or kumnick (http://goog_1657336074/) @epionline.org
(http://epionline.org/) .

The Employment Policies Institute is a nonprofit research organization dedicated to
studying public policy issues surrounding employment growth. In
particular, EPI focuses on issues that affect entry-level employment. EPI receives
support from restaurants, foundations, and individuals.