Republicans claim raising wages is somehow bad for workers


Congressional Republicans say increasing the federal minimum wage to $15 will cost millions of jobs. Experts say that's not quite true.

Congressional Republicans are pushing back on a plan to raise the federal minimum wage, saying it will lead to massive job losses across the country.

Experts say Americans would in fact benefit from such a change and that claims of widespread unemployment aren't rooted in reality.

On Tuesday, House and Senate Democrats reintroduced a bill to raise the federal minimum wage in annual increments from $7.25 to $15 an hour by 2025.

Republicans seized on one part of a Congressional Budget Office report — a potential $3.7 million overall job loss — to counter the proposed "Raise the Wage Act."

Rep. Ken Buck (R-CO) tweeted Tuesday, "This would cost millions of Americans their jobs. With small businesses struggling, Democrats are focused on wrecking the economy."

On Monday, Texas Rep. Kevin Brady (R) similarly tweeted that raising wages would result in "3.7 million less jobs, higher labor costs" and would encourage employers to use "technology to replace workers."

Also on Monday, Sen. Kevin Cramer tweeted his opposition of Treasury Secretary nominee Janet Yellen's confirmation, saying, "She seems too eager to raise taxes, her energy policies are job killers, and her willingness to unilaterally double the federal minimum wage with little regard for its impact on jobs is frightening."

Yellen was ultimately confirmed on Tuesday.

The CBO report that the Republican members of Congress are referring to states that the 3.7 million job loss figure is on the high end of its estimate, while its median estimate is 1.3 million.

Further, Heidi Shierholz, the Labor Department's chief economist under the Obama administration, told CNBC that the methods that the CBO employed to assess job losses were not sound and "substantially overstate[d] the costs" of the minimum wage increase.

The report further estimated that 17 million workers would see earnings increases in an average week. The wage raise would also lift 1.3 million people nationwide out of poverty, according to the CBO's estimate.

A separate report released Tuesday by the Economic Policy Institute showed that the wage hike legislation would benefit 32 million workers, lifting pay for 21% of the workforce in the United States.

Workers working year-round would make an additional $3,300 a year, which is "enough to make a tremendous difference in the life of a cashier, home health aide, or fast-food worker who today struggles to get by on less than $25,000 a year," the institute said.

Fifty-nine percent of workers in families below the poverty line would see an increase in earnings, the report noted, adding that 59% of women would benefit from the wage increase.

In light of the Republican's argument on the bill's effect on small businesses, the institute cited that organizations representing thousands of small businesses have endorsed the $15 minimum wage in states that already approved the earnings hike.

The policy group addressed the current recession saying that underpaid workers who earn more money will "directly counter the consumer demand shortfall."

The federal minimum wage today, $7.25, was passed in 2007 and went into effect in 2009.

Senate Budget Committee Chair Bernie Sanders stressed on Tuesday that "no one in America can make it on $8, $10, or $12 an hour," stating that Democrats "must use reconciliation to increase the minimum wage to $15 an hour" with a simple majority in the Senate.

House Education and Labor Committee Chair Bobby Scott (D-VA) said in a separate statement Tuesday, that the current minimum wage was "economically and morally indefensible" even prior to the pandemic, which has left many Americans in dire financial straits.

"Many of the essential workers who have braved a public health crisis to keep food on the table and care for our loved ones are still not being paid enough to provide for themselves or their families," he said. "...The Raise the Wage Act is a critical step toward lifting hardworking people out of poverty, addressing income inequality, and building back a better economy where everyone can succeed."

Published with permission of The American Independent Foundation.