We’re told that an increase in the minimum wage raises productivity:

The labour market needs to be rebalanced. For wages to rise, workers need to take home a larger share of national income – through a higher minimum wage, more security for workers in the “gig economy” and a higher proportion of sectors in which trade unions engage in collective bargaining. As other European countries show, this helps, not hinders, productivity improvement.

The proof is this, details in this paper.

OK, let us accept the contention for a moment. Raise the minimum wage, this raises labour productivity. So, for any given level of output we need to employ less labour then. That is, in the absence of a boost to economic growth we have just proven that a higher minimum wage creates unemployment.

We agree, it probably does. It’s just that we think it’s a strange argument in favour of a rise in the minimum wage.