Minimum Wage Laws Kill Jobs

The last year in which black unemployment was lower than white unemployment - 1930 - was also the last year in which there was no federal minimum wage law.  The Davis-Bacon Act of 1931 was openly advocated by some members of Congress on grounds that it would stop black construction workers from taking jobs from white construction workers by working for less than the union wages of white workers.  Nor was the use of minimum wage laws to deliberately price competing workers out of labor market unique to the Davis-Bacon Act or to the United States.  Similar arguments were made in Canada in the 1920s, where the object was to price Japanese immigrants out of the labor market, and in South Africa in the era of apartheid, to price non-whites out of the labor market.

Any group whose labor is less in demand, whether for lack of skills or for other reasons, is disproportionately priced out of labor markets when there are minimum wage laws, which are usually established in disregard of differences in skills or experience.  It has not been uncommon in Western Europe, for example, for young people to have unemployment rates above 20 percent.

Thomas Sowell, Intellectuals and Society, pp.450-451