You are presenting data which I have previously shown is not reprsentative of the whole labor market.
Did you present the information that any unemployment went up as a result or that hours worked dropped as a result? All you did in that thread was say that rising minimum wage would cause an indiscernible increase in the unemployment rate. Wouldn't it be easier for you to prove your case by showing how jobs decreased or workable hours decreased?
It looks like that's the post where somebody suddenly changed the topic from whether wages were keeping up to whether a minimum wage hike causes unemployment. Assuming the new topic was meant to have something to do with redistribution, there are a few things that need to be kept in mind.
1. The so-called "unemployment rate" is a miserably poor proxy for measuring the effect of anything on employment, because it only counts people who are actively seeking work. Of course when jobs are hard to come by that means there are many applicants for each job, which drives up the frustration level among job seekers, which inevitably causes many unemployed people to get discouraged, give up, stop looking, and no longer count in the government's statistics.
2. Even if two workers are functionally identical an intervention may cause worker A to get a job and worker B to lose a job, or not get one in the first place.
3. Workers are not functionally identical. There isn't just one employment rate; there's a rate for workers with X characteristics but completely different rates for workers with Y characteristics, Z characteristics and so forth. A raw number of unemployed people conflates many different rates.
With that background, consider...
The equilibrium market price for unskilled labor is P1. Suppose we raise the minimum wage to P2. The intended effect of that policy is to redistribute the wealth in the orange square and in red triangle BEA from employers to employees. But the actual effect is to redistribute only the orange square. The unintended effects are that the employers' wealth in red triangle BEA is destroyed instead of redistributed, and the employees' wealth in red triangle CEA is also destroyed. The orange square is typically bigger than red triangle CEA, so this intervention is a good deal for unskilled laborers
as a class, which is why minimum wage hikes are popular with unskilled workers and their advocates, but of course the proceeds of this redistribution are redistributed unevenly. There's a net reduction in hours of unskilled labor purchased from Q1 to Qd. If that reduction is accompanied by shortening the work week then it can be win-win for all the workers, who all get, say, 5% fewer hours and 10% higher wages; but in practice the work week is rarely shortened, so some workers keep their hours and other workers no longer get hours. So in addition to the redistribution from employers to employees there is also a net redistribution to the working poor from the unemployed very poor. Is their sacrifice for the greater good? Depends on point of view.
Now, as to whether this is all true or just theory. Does a minimum wage hike actually reduce purchases of hours of unskilled labor? Of course it's true. It has to be, because
that's how it accomplishes the redistribution of the orange square. The minimum wage does not order employers to buy unskilled labor for more than P1; it merely prohibits them from buying it for less than P2. Not the same thing at all -- they have the option of not buying. They won't buy it for P2 if they're only seeing it give them P1 of extra income. That would mean taking a loss on all the unskilled workers they hire, so why hire them? The intervention can only convince an employer to pay more for the labor by
making the labor worth more to her. How much the labor is worth to her is line DL. How much a given service is worth to buyers depends on how much they buy -- that's the Law of Diminishing Return. An extra bit of something benefits you more when you only have a little than it does when you already have a lot. Removing the Q1 - Qd hours from the purchase causes the remaining Qd hours to be worth more to buyers, and that's what makes them willing to pay P2 instead of just P1. There's no way for a minimum wage hike not to reduce purchased hours of unskilled labor unless the area of red triangle CEA is zero, i.e., if line DL is vertical. That's called "inelastic demand". So the claim that minimum wage hikes don't reduce hours amounts to a claim that the demand for unskilled labor is completely inelastic, a highly atypical characteristic in goods and services. The only other good or service with a completely inelastic demand curve is heroin.
So it seems to me the endless challenges to Loren to prove minimum wage hikes raise unemployment are misplaced -- people who claim employers are addicted to unskilled labor are making an extraordinary claim, and have burden-of-proof. If somebody does a study that fails to show a rise in the so-called "unemployment rate", see points 1 to 3, above. Reduced availability of unskilled jobs may add 1% to the number of job seekers but also cause 1% who used to be seeking jobs to get discouraged by the extra competition and give up looking. Employers may choose to reduce purchases gradually by hiring freezes and attrition instead of immediately with layoffs, resulting in net redistribution between cohorts of teenagers indistinguishable except for year of birth. And the government mandate on employers to pay skilled-labor prices for unskilled labor may cause employers to hold out for a skilled worker instead of hiring a lower-paid unskilled worker, so unemployment among the unskilled goes up but unemployment among the skilled goes down. Any way it settles out, there's still an unemployed guy whose wages got redistributed away from him.
