What’s Behind the Big Jump in Unemployment

On Friday, the government reported that the unemployment rate jumped from 5% to 5.5%, marking one of the largest jumps in decades. The increase was especially large for teenagers (up 3.3% to 18.7%). So what’s going on?
Mark Perry has one explanation, the increase in the minimum wage. Last year, Congress hiked the minimum wage from $5.15 to $5.85. That’s not all. Next month, it will rise again to $6.55, and next year it will rise still more to $7.25. That’s a 41% increase and it will be the largest two-year increase in 50 years.

Posted by on June 9th, 2008 at 10:26 am


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