To provide a slight counter example: 1. Employee A produces 20 widgets an hour 2. Employee B produces 100 widgets an hour There is a wage where employee A cost

To provide a slight counter example: 1. Employee A produces 20 widgets an hour 2. Employee B produces 100 widgets an hour There is a wage where employee A costs more than the value they create. By mandating a wage that is higher than their productivity they are simply not hired, they do not get a chance to gain experience/knowledge, they loose the chance to be as productive as Employee B. The result is they are now on welfare/unemployed/etc. They lose the chance to get on the employment ladder. In general people improve so we you shouldn't be making the low wages for long. But what do we do about people who don't improve - either we push them out of the workforce or we subsidize their lifestyle to meet a minimum threshold.