AB456 Testimony (Minimum wage)

Testimony in Opposition re: Assembly Bill 456 – Assembly Commerce & Labor Committee
Wednesday, April 10, 2019


My name is Daniel Honchariw. I represent the Nevada Policy Research Institute as its senior policy analyst and registered lobbyist.

NPRI opposes Assembly Bill 456 because it will reduce economic output, particularly in the event of an economic downturn, and will harm precisely those that its proponents are trying to help.

Labor is a commodity and, like all other commodities, is subject to the economic laws of supply and demand. By raising the minimum wage by nearly 50% over the next several years, AB456 will deny job opportunities to those most in need of gaining work experience.

A statewide minimum wage is particularly bad policy in a state like Nevada, where there are dramatic regional differences across the state. This bill ignores these differences and, as such, is likely to cause great harm in the rural counties.

Further, we can expect that marginalized communities will suffer disproportionately from AB456. Teenagers, minorities, and women are the demographic groups most likely to experience unemployment due to minimum wage policies. Data from the U.S. Department of Labor shows, for example, that the unemployment rate for teenage blacks is more than twice as high as that for teenage whites.[1]

Finally, even proponents of increasing the minimum wage caution that a minimum wage should never exceed half of the median wage.[2] AB456 would set Nevada’s minimum wage well above that level.

The Legislature can better help low-wage workers by repealing or reducing onerous licensing requirements, reducing state spending and the state’s regressive sales-tax rate, and supporting proven education-reform efforts.

This committee should oppose AB456. While it is well intentioned, it will cause significantly more harm than good.

[1] U.S. Department of Labor, Bureau of Labor Statistics, Labor Force Statistics from the Current Population Survey, 2013.
[2] Dube, A (2013). Statement before the U.S. Senate Committee on Health, Education, Labor & Pensions. Retrieved from: https://www.help.senate.gov/imo/media/doc/Dube.pdf