Why would anyone in their right mind hire a teenager?
Think about it for a moment. From a business owner’s point of view, the obstacles to getting the most for your money are rather significant.
“There are state laws governing the hours minors can work, accessibility to alcohol, use of motorized equipment and handling cash in the evening, just to name a few,” Cliff Hammond, a partner at the Detroit-based labor and employment law firm Nemeth Law, recently pointed out.
In general, Hammond said, these are “common sense rules that help keep our teens safe at work while also protecting employers from potential liability.” But in a world in which there is often no shortage of adult workers for whom an employer doesn’t have to worry about such things, what’s the benefit of hiring a teen?
Well, in Michigan and a handful of other states, the benefit is the bottom line. That’s because the Michigan Workforce Opportunity Wage Act allows employers to pay minors 85 percent of the state’s minimum wage — $7.25 per hour instead of $8.50.
At first blush, that might sound unfair to teen workers. It might even strike some as age discrimination (so far, at least, the United States Department of Labor has concluded otherwise.) A move to lower teen wages shouldn’t affect what anyone is making right now — rather it should be implemented as part of considerations, active in almost every state, about raising the adult minimum wage.
Here are three reasons why lower minimum wages for teens might be good for young workers, and why more states might want to consider following Michigan’s lead:
1) Young workers are like “non-cog” interns
We already know that employers are taking on far more regulations when they hire young workers. They’re also taking on the responsibility for instilling non-cognitive skills that aren’t always taught in school and sometimes aren’t taught at home, either. Persistence, self-discipline, teamwork, organization and the ability to seek help when needed are some of the most valuable skills a worker can have — and job experience offers opportunities to practice these skills in droves.
We’ve long recognized that employers should have a bit more leeway in how compensate interns and apprentices who are seeking to build specific skills from a job experience. Perhaps it’s time we reward, in some small way, employers who are able to offer their young workers opportunities to develop these more generalized — but perhaps even more important — skills.
2) Our future workforce is being hamstrung by low teen employment rates
As we’ve pointed out in the past, summer teen employment is a key predictor of employment as an adult — yet the number of employed teens has fallen precipitously in the past two decades, particularly among minorities and the poor. Other than good old-fashioned altruism, though, employers have few incentives for helping solve this problem. It may be time to change that.
3) Most of the time, teens simply need less money to live
There are, of course, plenty of teenagers who are paying every last one of their own bills. That’s why, when discussing a minimum wage for minors that doesn’t rise as fast as the adult wage does, legislators might wish to consider rules that exempt legally emancipated teens.
The vast majority of teenagers, however, live full-time with at least one parent who is employed year-round, according to the U.S. Census Bureau. Few are paying to keep a roof over their heads or food on their tables. Public schooling is, of course, free for children under the age of 18, as are healthcare coverage and school lunches for those who are most in need.
Indeed, paying teens wages that are commensurate with those we pay adults — who have more expenses — could, in fact, have the effect of teaching poor budgeting habits. What one can do with $7.25 an hour when they are 16 and have no overhead is, after all, a lot different than what one can do with that wage when they are 20 and paying for rent, health insurance, food and other basic necessities.
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