Bill Gates surprised his hosts at MSNBC in a recent interview. He cautioned against the minimum wage as a tool for supporting workers in poverty, noting that it would increase the incentive for employers to replace their staff with automation or find loopholes in the law.
Well, jobs are a great thing. So you have to be a bit careful: If you raise the minimum wage, you’re encouraging labor substitution, and you’re going to go buy machines and automate things — or cause jobs to appear outside of that jurisdiction. And so within certain limits, you know, it does cause job destruction. If you really start pushing it, then you’re just making a huge trade-off.