Washington state's Department of Labor and Industries today announced that the minimum wage for Washington hourly employees will be $8.07 for 2008, an increase of $0.14 per hour over 2007's level. We've "enjoyed" having the highest minimum wage in the nation the last 3 years. Since 1998 when the minimum wage was linked to the Consumer Price Index (urban and clerical workers) Washington's business community has seen a 57% increase in the minimum wage.

Now, I know what you are thinking. You're thinking "57% above $5.15 per hour in ten years is a horrendously slow pay increase. No one can survive on that slow of pay increases." But let's take a look at what the Bureau of Labor Statistics likes to call "Characteristics of Minimum Wage Workers."

1. About half of all workers nationwide making the federal minimum wage are under 25 years of age, and about half of those (one quarter overall) are between 16-19 years old.
2. Minimum wage workers tend to be part time.
3. By major occupational group, the highest proportion of workers earning at or below the Federal minimum wage was in service occupations -- occupations that largely incorporate tipping.
4. The proportion of hourly-paid workers earning the Federal minimum wage has trended downward since 1979.
5. Sixty-three percent of minimum wage workers are making more than minimum wages 1 year later. A

Fewer workers are earning the minimum wage today (by percentage of workforce) than 20 years ago. Most minimum wage workers tend to be young and unmarried. Most minimum wage workers are making more than minimum wage after more than one year in the labor market.

One of the consequences of public policies such as price controls on the cost of labor is that it drives down demand for jobs that were previously deemed low-wage jobs (often starter or entry-level jobs). When this happens, it's less likely that any business, large or small, will be willing to pay more than market prices for an employee that does not warrant the artificially set price.

I remember my father told me his first job was pushing a broom in a lumber mill for a couple of bucks per day. And while inflation obviously plays a part in what a person makes today versus 40 years ago, I'm not so sure too many businesses -- particularly small businesses -- are going to pony up over $8 per hour to pay a kid to push a broom.

So, who gets hurt with these policies? Small businesses? Sure. But the real consequence falls on the teenager with no work experience who's looking to break into the labor market.