Increasing the federal minimum wage to $15 would pull nearly one million people out of poverty, but it would also result in the loss of 1.4 million jobs, according to a report by the Congressional Budget Office (CBO).
“Employment would be reduced by 1.4 million workers, or 0.9 percent… and the number of people in poverty would be reduced by 0.9 million,” CBO conclude in the study released on Feb. 8, adding that pay for those affected would increase by $333 billion.
“The year when the minimum wage would reach $15 per hour, 17 million workers whose wages would otherwise be below $15 per hour would be directly affected, and many of the 10 million workers whose wages would otherwise be slightly above that wage rate would also be affected,” the study explained.
CBO also found out that raising the minimum wage would increase the cumulative budget deficit from 2021 to 2023 by $54 billion, which would increase the prices for goods and services.
In an interview with CBS Evening News last Feb. 5, President Joe Biden, who included the proposed hike to his COVID-19 relief package, said that he does not think he will be able to raise the minimum wage from $7.25 to $15 an hour due to the rules of the Senate.
“I put it in, but I don’t think it’s going to survive,” Biden said.
Meanwhile, Vermont Senator Bernie Sanders, who is also the Senate Budget Committee Chair, told CNN on Feb. 7, “We have a room full of lawyers working as hard as we can to make the case to the parliamentarian that, in fact, raising the minimum wage will have significant budget implications and, in fact, should be consistent with reconciliation rules.”
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