A July Congressional Budget Office (CBO) report predicts that increasing the minimum wage to $15/hr. will eliminate up to 3.7 million jobs by 2025.
The report was published in light of Democrat’s pushing voting on Raise the Wage Act. A median estimate of 1.3 million jobs would be lost, the CBO estimates, if the federal minimum wage is raised from the current wage of $7.25 to $15 per hour. Losses could reach 3.7 million jobs by 2025, however, the report states.
According to the Employment Policies Institute, nearly 2 million jobs would be lost if the federal minimum wage were raised to $15 per hour.
“If House Democrats were uneasy about voting on $15 before this week, the CBO report should have them terrified,” EPI spokeswoman Samantha Summers said in a prepared statement. “The CBO provides further evidence of what countless studies have also shown: Raising the federal minimum wage will only hurt those it intends to help, wiping out thousands of starter job opportunities and shuttering the businesses that provide them.”
Alternatively, raising the wage to $12 per hour would result in job losses of 800,000, while an increase in pay to $10 per hour would lead to losses of 100,000 nationwide, the report states.
Critics argue that an alternative to the minimum wage increase, which has been successful is expanding the earned-income tax credit.
Using a tax credit helps low-income earners to retain more of their income.
A recent University of Washington study found that Seattle’s minimum wage hike to $15/hour led to low-wage workers losing an average of $80 a month in lost hours.
New York City’s increased minimum wage resulted in the restaurant industry reporting the loss of 6,000 restaurant jobs in 2018, EPI notes.