The Yahoo news spin meister article used as an OP for another thread presents a grossly distorted picture of the CBO study on the impact of raising the minimum wage to $15 per hour. A far more realistic analysis of the CBO study's findings follows.
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Just in time for next week's potential House of Representatives vote on the Raise the Wage Act, which would increase the federal minimum wage to $15, the nonpartisan Congressional Budget Office is out with a damning new report on the bill's consequences.
Congress's official budget scorekeeper estimates that a $15 minimum wage would cost up to 3.7 million jobs, with median job loss expected at 1.3 million - about 7 percent of the nation's entry-level workers and 1 percent of the overall workforce.
The finding is sobering for minimum wage hike activists who for years have ignored the real-world stories of minimum wage harm to claim that a $15 minimum wage has no employment consequences.
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Who would bear the brunt of this politically popular but ill conceived legislation?
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Of course it's true that mandating a higher wage will help the people who are able to keep their jobs in the aftermath. Coincidentally, the CBO also found that 1.3 million people would emerge from poverty thanks to the wage hike. But is this one-for-one tradeoff acceptable? Not if you care about employment opportunities for the most vulnerable Americans.
Unsurprisingly, the CBO concludes that women, workers without a high school degree, and part-time employees would bear the brunt of the impact. Some of these victims actually would be pushed into poverty because of a $15 minimum wage. The harsh reality is that those who benefit from a $15 minimum wage likely are the ones who don't need it; they're the most productive employees, from better schools and stable families, who would be earning $15 soon with or without a minimum wage increase.
Ironically, the CBO finds that a $15 minimum wage would reduce family incomes by $9 billion. Speaking of unintended consequences, a blockbuster University of Washington minimum wage study in 2017 found that Seattle's incoming $15 minimum wage reduced wages among entry-level employees there by $125 a month, because employers were forced to cut hours and jobs to make up for increased labor costs. (That figure later was revised to $74.)
But the biggest consequence of a $15 minimum wage is the impact that it would have in weakening the first rung of the career ladder, which is needed to teach employees the skills necessary to climb it. According to the CBO report, "Low-wage workers who are jobless because of a minimum-wage increase cannot acquire skills through formal on-the-job training or informal learning by doing. Reductions in training might occur even among employed workers if firms cut their spending on training to offset their higher payroll expenses." As a result, it concludes, career prospects would be negatively impacted.
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Using Seattle as an example raising the minimum wage to $15 per hour would reduce the incomes of working poor families. More importantly it would reduce opportunities for the very people Democrats claim they want to help to get that entry level job and balloon the cost of OJT necessary to provide the skills for advancement.
Like so much of the Progressive agenda raising the minimum wage sounds great as long as the real world consequences are ignored.
https://www.google.com/amp/s/thehill...islation%3famp
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07-18-2019, 10:40 AM
CBO report should spike $15 minimum wage legislation
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