A look at the latest economic research.
By Gus Wezerek Graphics Editor, Opinion |
House Democrats have spent the past week rushing to assemble a stimulus package before pandemic-related unemployment benefits expire next month. One of their most controversial inclusions is a proposal to gradually increase the federal minimum wage from $7.25 to $15 an hour by 2025. |
Republicans, and some centrist Democrats, are skeptical of the idea. "A $15 federal minimum wage would be devastating for our hardest-hit small businesses at a time when they can least afford it," said Senator Joni Ernst, Republican of Iowa, in a speech last week. |
Ernst's worries are understandable. In poorer states, the median wage is close to $15, meaning Democrats' proposal would give almost half of all workers a raise. Small business owners might be forced to lay off employees or close their doors. |
But as I argue this morning, Republicans' concerns aren't supported by the latest economic research. |
"A large body of high-quality research has investigated the impact of minimum wages on employment," wrote Arindrajit Dube, a professor at the University of Massachusetts Amherst who analyzed results from different studies of what happened to jobs in cities and states that raised local wage minimums. Dube concluded that most studies showed that higher minimum wages had a "relatively modest" effect on low-wage employment. |
For Erica Hunt, who makes $12 an hour working at a Taco Bell in Milwaukee, an increase to $15 would help her start to catch up on the bills she juggles each month while supporting her four children, her mother and her stepfather. |
 | | Sara Stathas for The New York Times |
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To supplement her wages, Hunt visits food banks and picks up weekend shifts at another fast food restaurant, JJ Fish & Chicken. She saves coupons, tries to stock up on necessities when they go on sale and is enrolled in a range of programs that subsidize her utility bills. |
But no matter how careful Hunt is with her spending, she finds herself hundreds of dollars short when it comes time to pay her bills. |
"A lot of people like me are called lazy or unreliable," Hunt told me. "But they aren't. There's not enough income in this work to stay afloat." |
Hunt supports a higher minimum wage, as do 72 percent of Americans, according to an August survey by Public Agenda. Whether Congress will listen to their opinions, and those of a majority of minimum wage researchers, remains to be seen. |
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