A federal rule that hurts millennials

Amity Shlaes explains in a Forbes column why a move to scrap the Obama administration’s expansion of overtime benefits to workers with lower salaries makes sense for millennials.

“A GOLDEN recommendation” for their second job is what most college grads dream of as they enter the workforce. Their first job, they are certain, will be an 18-month compromise, a pass-through position they take on to build résumés. The second job, the one that matches their plans, is the job they actually seek. But to get to that second post, they need a strong recommendation from an authority in the real world, not a professor. In other words, that golden recommendation from the boss at the initial compromise position. …

… [T]he Labor Department of the Obama Administration sought to raise the ceiling below which time-and-a-half overtime pay is required by Washington. The new level was set at $47,476, from the old $23,660, an expansion affecting millions. Many of those millions are not recent college grads, but many are. …

… [I]t is the younger workers who will truly struggle. Back in the old days, first employers got to know their employees, and, yes, it is fair to say, love them. Older adults are hardwired to make outsize gifts to youth. Employers used to move heaven and earth for “their” 23-year-old staffers, even staffers whose politics grossed them out.

These days management still derives major benefit from young hires: fresh brains and faces, a low price and stunning (to oldsters) understanding of iPhones, high tech, computer science and tech markets.

The trouble is that stock picking or coding often are not part of the description of that first job. And nowadays significant burdens offset youth’s advantages. College grads, especially–and perversely–humanities grads, haven’t logged the hours reading that even Miss Northwestern did. The antibusiness culture of college developed their appreciation of social-justice regulation to a counterproductive extent. The same culture failed to convey the seriousness of what happens at the office, whatever the product. Tech-vain and diploma-proud, these youths don’t always “get” workplace discipline or hierarchy. …

… The way up for anyone earning less than $47,476 is education. The only difference is that older workers benefit from going back to school, while younger workers need to unlearn school. Yet young workers regard overtime pay as their due.

The result is the same negative dynamic that occurs with the minimum wage. To avoid the extra cost, employers commit a worse social injustice by taking workers off salary–and perhaps health benefits–spreading the work among anonymous, unmentored part-timers. Another management response to marginal cost increases is to skip hiring young people altogether. Only trained workers may actually warrant the higher costs. …

… It’s therefore good news that the free-marketers joining the Administration give every sign of their willingness to abandon initiatives like the [Obama overtime] rule.

Mitch Kokai / Senior Political Analyst

Mitch Kokai is senior political analyst for the John Locke Foundation. He joined JLF in December 2005 as director of communications. That followed more than four years as chie...

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