Of Jobs and Math

Of “J-O-B-S” and “M-A-T-H”: Obama Could Use a Dose of His Own Condescension to Learn How Raising the Federal Minimum Wage Would Kill Jobs

By Ken K. Gourdin

Although I do OK at functional arithmetic (for example, calculating a tip), the truth is that I suck at math.  It’s my weakest (and least favorite) subject.  I’m beginning to wonder, however, whether there might be someone who sucks at math even worse than I do: President Barack Obama and others who favor raising the federal minimum wage.

During the last election, at various points during the presidential debates between President Obama and former Massachusetts Governor Mitt Romney, Obama’s rejoinders to Romney dripped with condescension, such as when Obama ridiculed Romney’s claims that lowering tax rates actually would increase the amount of money the government takes in.  Obama (who, before he became president, never had a job that required him to do simple math, in contrast to Romney, whose experience with large business deals likely necessitated routine work with large numbers) dismissed the notion by snorting derisively, “It’s math.”

When it comes to raising the minimum wage, let’s talk about that math you love so much (and don’t think Mitt Romney understands), Mr. President.  Say I run a small business.  Say I have budgeted $10,000 per month to pay the salaries of my employees.  If I pay them the current minimum wage of $7.50 per hour, and if all of those employees are full time, I can pay slightly more than 1,333 employee-hours of wages, meaning that I can have slightly more than eight (8.33) full-time employees at 40 hours per week or 160 hours per month. 

Suppose legislation were passed through Congress which you then signed into law mandating an increase in the minimum wage from $7.50 to $10.00 per hour.  Provided the amount I have budgeted for salaries remains constant, that mandated 33% increase in my employees’ wages means that I must: (1) cut the number of people I employ, or (2) cut the number of hours my employees work, or (3) some combination of the first two options.  At $10.00 per hour, I have gone from being able to pay 1,333 employee-hours of wages to being able to pay 1,000 employee-hours of wages.  Thus, if I cut hours rather than employees, I’ve gone from being able to pay 8.33 full-time employees at 40 hours per week (or 160 hours per month) to being able to pay 6.25 employees at that level.  If I maintain my current workforce but cut hours, each of my formerly-full-time employees must have their hours cut from 160 hours per month to slightly more than 120 hours per month (1000 / 8.33 = 120.04).

I would think that someone who eats, drinks, breathes, sleeps, walks and talks job creation like President Obama says he does would be able to understand that mandating an increase in the federal minimum wage would have the effect of reducing available jobs (or at least, of reducing available work hours).

After all, as the President so condescendingly chided Mitt Romney (What does the multibillion-dollar-dealmaking Romney know about numbers, anyway, right?), “It’s math.”  (Of course, I do have to give the President credit where it’s due: whatever he might leave to be desired as a mathematician, he’s still better at both math and spelling than his Vice President, Joe Biden, who once famously said that “J-O-B-S” is a three-letter word.)  

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About kenngo1969

Just as others must breathe to live, I must write. I have been writing creatively almost ever since I learned to write, period! I have written fiction, book- and article-length nonfiction, award-winning poetry, news, sports, features, and op-eds. I hope, one day, to write some motivational nonfiction, a decent-selling novel, a stage play, and a screen play.
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