Message to the Congress Transmitting Proposed Youth Employment Opportunity Wage Legislation

To the Congress of the United States:

I am pleased to transmit to you proposed legislation entitled the "Youth Employment Opportunity Wage Act of 1985."

One of the Nation's most serious and long-standing problems is providing adequate employment opportunities for our young people. Even in times of great economic prosperity, unemployment remains a significant problem for young people, particularly young Blacks and Hispanics. The purpose of the draft bill is to make it possible for employers to expand job opportunities for young people during a period of special need—when young people are looking for summer jobs.

The proposal would permit employers to pay young people under 20 years of age, from May i through September 30, a wage of no less than either 75 percent of the otherwise applicable minimum wage or $2.50 per hour, whichever is less. This bill provides protections so that adult workers or previously hired youth will not be adversely affected by the proposal. It prohibits the discharge, transfer, or demotion of any employee because of ineligibility for the youth wage and for the purpose of hiring an eligible youth and it provides penalties to assist in enforcement of this provision.

For many businesses, the existing minimum wage prices unskilled young people out of the job market. While some businesses can afford to hire unskilled youth and provide the training and experience expected to pay off in future productivity, such expectations are often unreasonable over a short summer employment span.

Studies over the past decade have repeatedly demonstrated that the minimum wage has reduced job opportunities for large numbers of our youth. This is particularly true for jobs involving considerable initial training. The restricted job opportunities for youth, especially minority youth, due to the minimum wage have contributed to the growing consensus on the value of a lower minimum wage for youth as a means of expanding their employment.

The concept of a youth employment opportunity wage has attracted a broad coalition of support. It has been endorsed by many organizations, including the National Conference of Black Mayors and organizations representing businesses that would provide jobs for these youth.

The proposal would enable employers to expand job opportunities for youth during the summer months. It would enable many young people to find jobs, earn money, and gain the experience and skills needed for future work and higher wages. The bill would not diminish the opportunities for higher wages for those with job skills.

Because it provides for a demonstration period and an evaluation of the program, the bill should allay any doubts as to the ameliorative impact of the youth employment opportunity wage.

I urge the Congress to enact this legislation speedily.

RONALD REAGAN

The White House,

March 25, 1985.