NYC Mayor Zohran Mamdani sells his “$30 by 2030” minimum wage plan as a lifeline for the working class, but it’s really a career-ender for the hundreds of thousands of New Yorkers who hold entry-level jobs.

While reducing poverty is a bipartisan objective, socialist wage floors are a utopian vision that may create economically catastrophic consequences for the Big Apple.

New York City’s minimum wage is $17 per hour, effective January 1, 2026.  Mamdani’s $30 proposal is a 76% increase from the current hourly wage and risks causing a shock that would spur mass layoffs and create inflation.

The city of Seattle has already seen this play out. End-of-year unemployment was 3.6% in 2022 at a $17.27 local wage floor, compared to 4.9% in 2025 at a minimum wage of $20.76. In King County, specifically, layoffs in the accommodation and fast-food industries rose from 158 in 2024 to 2,090 in 2025—a neck breaking 1,223% increase in job losses year-over-year.

Similarly, when California raised its fast-food wage floor from $16 to $20 per hour in April 2024, approximately 18,000 laborers lost their jobs. This minimum wage hike was particularly harmful for the younger generation just entering the workforce, trying to build their initial resume and gain work experience. Youth unemployment hit a record high of 21.2% in April 2025, nearly double the national average.

Wage floors harm more than just the businesses and employees directly affected by salary changes. Increased labor costs are often passed onto consumers in the form of higher prices. In California, fast-food prices inflated by 14.5% just so establishments could remain profitable, to the detriment of buyers.

Small businesses are often considered the lifeblood of the U.S. economy, serving as the foundation for economic growth. Approximately 2.4 million small businesses exist in New York City, accounting for over 90% of firms who employ over half of the labor force in the private sector. A $30 minimum wage would force employers to only keep the most productive workers and cut lower-skilled employees, leading to job losses potentially impacting half of the city.

Additionally, the only businesses capable of paying an artificially high $30 per hour salary and maintaining employment levels would be larger, established firms. A wage floor may push small businesses out of the market, thereby restricting entrepreneurship and stifling variety for consumers.

Despite their consequences, minimum-wage increases are not abnormal given that 19 states recently raised their wage floors at the start of the New Year. Minimum wages were first set by the 1938 Fair Labor Standards Act to restructure the labor market during the Great Depression. The aspiration was that setting a national wage floor would prohibit oppressive child labor and reserve jobs for able-bodied adults.

Instead of using wage controls for these reasons, Democratic Socialists not only view government mandated wage increases as a gateway towards improving the standard of living for citizens, but as a floor for the family's breadwinner. However, the tradeoff of higher wages is fewer jobs, which often harms the very people this policy intends to assist.

Socialists don’t seem to realize that when they increase wages artificially, they interfere with the natural relationship between labor supply and demand. In a competitive market, the “invisible hand” of uncoerced preferences determine price and quantity by allowing supply and demand to freely interact.

Enforcing a wage floor requires an expansion of government authority, curtailing this invisible hand, and comes at the expense of individual economic freedom, unemployment, inflation, and business flight.

If Mamdani wants to reduce poverty and bring affordability back to New Yorkers, he should start by focusing on supply-side improvements that target the determinants of higher wages. These include education and skill development for laborers, and prudent deregulation, tax-cuts, and pro-growth opportunities for businesses.

Rather than implementing an onerous wage floor—which risks job losses for the young and low-skilled, inflation, business flight, and further government intervention—ensuring a price-stable and deregulated economic environment would allow business to operate freely, workers to earn a living wage, and consumers to buy at reasonable prices.

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Nicole Huyer is a Senior Research Associate in the Roe Institute at The Heritage Foundation. Payton Kleidon is a member of Heritage’s Young Leaders Program.

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