American Samoa is an unincorporated territory of the United States located in the South Pacific Ocean. It has a total land area is 76.1 square miles, slightly more than Washington, D.C., and a total population of about 55,000 people. It also has 18 different minimum wages by industry, mandated and enforced by the US Department of Labor. Oh, and an unemployment rate of 29.8% (about 10% of the total population is out of work).
Minimum wage advocates would likely say that American Samoa is an anomaly since it has too small a workforce to draw any representative conclusions. And they might be right about that. But as Mark J. Perry asks, why wouldn’t proponents of the US minimum wage support an American Samoa style multiple wage structure:
If you support a single hourly minimum wage in the US, wouldn’t you show even more support for multiple, government-mandated minimum wages by industry? That is, if you trust the supposed wisdom of politicians to know what the “correct” single minimum wage is for the entire US economy (currently $7.25 per hour), shouldn’t you also trust those same politicians to know what the “correct” minimum wage is for America’s many different industries? If a single minimum wage is “good” for the economy, wouldn’t multiple minimum wages by industry be even much better?
If all work is worth either $0 or $7.25 an hour (the current federal minimum wage), why wouldn’t it make sense to have minimums based on the type of work involved? I’ve never heard minimum wage advocates argue for such a position, though. Why not? I’m genuinely curious to know how they might answer.