This week the Competitive Enterprise Institute’s Labor Policy team re-launched its flagship website, WorkplaceChoice.org, featuring the original video: “The Life of Julius: How Unions Hurt Workers.”
Bringing Julius to life was fun and rewarding, but it was no piece of cake. During our research for the project, my colleague Matt Patterson and I came across a key statistic about the effects of minimum wage: up to 50,000 people lost their jobs due to the first minimum wage law in 1938. This is the kind of data we had been looking for.
However, before we could use this figure we needed to first sort out a certain discrepancy.
Our source, a 2012 Cato Institute study by Mark Wilson called “The Negative Effects of Minimum Wage Law,” cited the U.S. Department of Labor (DOL) as having released this information. However, the footnote sourced an entirely different Cato study that had been published in 1985: “A Public Choice View of the Minimum Wage” by Thomas Rustici.
And so we continued our investigation, searching for the original source of this data.
Upon examining Rustici’s work, we indeed came across the exact same information as the previous study. The publication confirmed that the DOL assessed the effects of the first minimum wage law in 1938 and did determine that the law led to the elimination of up to 50,000 jobs. To our disbelief, though, this study sourced the DOL’s findings to yet another document: page 29 of Jonathan Grossman’s “Fair Labor Standards Act of 1938: Maximum Struggle for a Minimum Wage.”
Trying to untangle this mess, we searched the Internet for Grossman’s work and to our relief his study was in fact posted on the DOL’s website – but page 29 was nowhere to be found. The fine print said that the missing pages had “been omitted in the electronic version,” and so we had reached a dead end.
But not for long.
We decided to call the DOL and figure out where the data on the damaging effects of the first minimum wage was coming from. The DOL’s website had an extensive list of contact numbers within the Department. Matt and I chose to call the Bureau of Labor Statistics (BLS), a branch of the DOL, since this department is the “principal Federal agency responsible for measuring labor market activity, working conditions, and price changes in the economy.”
Surprisingly, we had hardly any waiting time before being connected to a man named Steve Hipple, an economist for the DOL’s Division of Labor Force Statistics. We explained our problem to him and though at first he was unsure what to tell us, he was very helpful and told us that he would look into it and give us a call back. In the meantime, he said that we should try contacting the Minimum Wage and Overtime extension.
And so we did. A lady answered the phone, but she said she could not help us. We were transferred to another man who didn’t have any input or suggestions either. We were back at square one.
As promised, though, Steve called us back—and with good news. He found the original hard-copy publication and the exact numbers we had been looking for. Rustici correctly referenced Grossman’s piece, though he sourced the page incorrectly (the right one is page 28). And Rustici had also sourced the document inaccurately; Grossman was indeed a historian at the DOL, but the piece appeared in the June 1978 Monthly Labor Review, which is a BLS publication.
Steve explained that only certain pages of this study were available online, but the one page we needed was not on the Web. He was not only kind enough to find the source and call us back (in exactly 15 minutes as he had said he would), but he even offered to scan the missing pages and send the entire article to us as a PDF file.
So WPC is proud to offer to our readers, with the blessing of Mr. Hipple and the BLS, a valuable resource on minimum wage laws, previously unavailable anywhere on the Web.
Grossman Jonathan (June 197… by on Scribd