A person’s first job is often their most consequential. Whether as a store clerk, babysitter, or company intern, early work experience is invaluable in developing work ethic and opening future professional opportunities. Yet, young workers have fewer employment opportunities than their older counterparts. Over the last 60 years, the youth employment rate in the United States averaged over 12 percent, or over twice as high as the unemployment rate across all age groups.
In Arizona, the problem is compounded with minimum wage and labor mandates that are pricing young and inexperienced workers out of the workforce. Young workers in Flagstaff are the first to show signs of pain, and the rest of the state is close behind. In January, Flagstaff’s minimum wage hit $12 an hour. That is nearly $5 higher than the federal minimum wage. Even after the passage of Prop 206, it is also $1 more than the rest of Arizona.
Already the effects are being felt by small businesses, workers, and their customers. The Northern Pines Restaurant in Flagstaff reported that they are letting go two of their prep chefs. They are eliminating free juice and two sides with many of their meals, or charging extra for them. And things are only going to get worse. The minimum wage is set to hit $15.50 in Flagstaff by 2022. Arizona’s minimum wage is set to rise to $12.00 an hour by 2020 and then adjust upward by the cost of living.
The Heritage Foundation has estimated a $15 minimum wage in Arizona would result in more than 200,000 lost jobs, and almost all of those are among the lowest skilled workers.
It is also a simple economic reality that high minimum wages eliminate entry level jobs, including those most likely to be filled by young workers just entering the workforce and part-time workers seeking extra income while going to school. One of the true cruelties of minimum wage mandates is that those who are just trying to get a footing to build a life may have fewer and fewer opportunities for taking that first occupational step.
Representative Grantham’s HB2523, the Youth Employment Act, helps protect these young job seekers. Under this legislation employers may pay a wage equal to or greater than the federal minimum wage and agree on other terms and conditions of employment with workers who are:
- under 22 years old;
- enrolled as a full-time student; and
- employed for 20 hours a week or less or on an intermittent basis, such as over the summer.
In other words, it allows full-time students working part time to get job opportunities that might not otherwise be available to them. That is perhaps why it is supported by a broad coalition of allies, including the Flagstaff Chamber of Commerce, the Arizona Chamber, the East Valley Chamber, and the NFIB.
Some have objected that the bill violates Prop 206. But that is not the case. Prop 206 increased the minimum wage for certain workers, including full-time workers, which the voter literature focused on extensively. That measure, however, did not define “employee.” And the Youth Employment Act does nothing to amend Prop 206. Rather, this legislation creates a new classification of young workers who are full-time students working part time. This also happens to be in line with federal precedent, which, in several areas, allows employers to pay young workers and part-time workers less than the federal minimum wage.
The Youth Employment Act is the right response to a real and worsening problem at the right time. This measure will ensure that Arizona’s youth will not be shut out of the workforce, but instead, will have as many opportunities as possible to build work ethic, character, and a resume.