Minimum wage will hurt students, consumers

By Jeremiah Caterina

A survey released earlier this year from Public Policy Polling found 63 percent of voting Illinoisans support the increase. Consider me the minority.

One reason I oppose a minimum wage hike is due to the negative effects the increase would likely have on our university and its students.

One of the first impacts would be job availability for students on and off campus.

“As firms try to do more with less, jobs on campus, and off for that matter, will be more difficult to come by,” said associate economics professor Jeremy Groves. “It will be harder to find a job simply because there are going to be fewer openings.”

Higher wages in a labor market cause higher competition for jobs. Business owners and managers may look for ways to automate to keep labor costs low. Both cases produce a supply of labor greater than its demand, also known as higher unemployment.

In the long run, students looking for a job won’t be the only individuals impacted by raising the minimum wage; we all will.

The macroeconomics trend known as the “wage-price spiral” theorizes that as wages rise, so do prices. Ultimately, you and I will be paying the higher price of wages through our consumption of goods. Your morning coffee, lunch at Dog Pound Deli and other goods and services are likely to cost you a few cents more if labor costs rise. An increase in minimum wage will affect us all.

At a time when NIU is already facing nearly $12 million in budget cuts, a hike in university expenses caused by raised wages would be an unneeded burden which could lead to more cuts.

Under the current law, there would be no way to avoid this cost increase and sustain student employment levels on campus.

“We have to comply with the [minimum wage] law regardless of whether it stays the same or rises,” said Paul Palian, director of media and public relations.

If lawmakers do ultimately decide to increase the wage, I suggest they exempt public universities from the law.

An exemption would be mutually beneficial for universities and students.

The university would no longer be faced with a substantial cost increase and could focus on navigating impending budget cuts.

Students would have an easier time finding jobs on campus since competition would not increase.

Finally, because an exemption would help keep the campus’ costs low, goods and services offered at NIU could continue to be reasonably priced.