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Will Congress Hike the Minimum Wage This Year? Part Two: Talking Points
  • On February 18, the Congressional Budget Office released a report titled "The Effects of a Minimum-Wage Increase on Employment and Family Income" that may take the wind out of the sails of members of Congress who want to raise the minimum wage this year, because it highlights the damage a minimum wage hike to $10.10 will do to the economy and low wage workers.
  • Late last year, the White House expressed support for a Senate Democrat proposal to raise the minimum wage to $10.10 an hour. President Obama mentioned the proposal, the Harkin/Miller bill (S. 460, the Fair Minimum Wage Act of 2013), in his State of the Union speech last month. The CBO report released on February 18 analyzes the effects of raising the minimum wage to $10.10 an hour based on the provisions in the Harkin/Miller bill. 
  • The current minimum wage by federal standards is $7.25 an hour. The Harkin/Miller bill would raise the minimum wage to $10.10 in 2015 by 95 cent increments. 
  • The last change in minimum wage took effect in July 2007, when it was raised from $5.15 an hour to $7.25 an hour in July 2009.
  • As the CBO report notes, as of last month, 21 states and the District of Columbia have raised the minimum wage higher than the federal standard on their own initiative.
  • According to the CBO, the minimum wage hike proposed in the Harkin/Miller bill would reduce total employment by about 500,000 workers. The report notes, however, that "the actual losses could be smaller or larger; in CBO's assessment, there is a two-thirds chance that the effect would be in the range between very slight reduction in employment and a reduction in employment of 1.0 million workers." The report names the 500,000 figure the "central estimate" of workers who will lose their jobs as a result of the minimum wage hike, and a slight decrease in workers who will lose their jobs to 1.0 million workers who will lose their jobs as the "likely range."
  • The report also notes that those minimum wage workers who will take home more real income if the Harkin/Miller bill passes are in two different living situations: low wage earners who are not living beneath the poverty threshold, and low wage earners who are members of low-income families living under the poverty threshold. Only 19% of the low-income families will be taking home higher, real wages if the bill passes. At the same time, three groups of people will see a reduction in real income--people who become jobless as a result of the minimum wage increase, business owners, and consumers facing higher prices. 
  • An increase of minimum wage to $10.10 an hour would result in an overall rise in real income by $2 billion once all increases and decreases are taken into account. 
  • An increase of the minimum wage to $10.10 an hour would lift 900,000 people above the poverty threshold out of 45 million who live under the poverty threshold. 
  • The minimum wage hike may come up in the next Senate work period, in March. 
In Case You Missed It

           Today, Speaker John Boehner opened the "Stop Government Abuse" week in the House of Representatives by speaking on the House floor about the Obama Administration's report on ObamaCare released last Friday by the Center for Medicare and Medicaid Services. The report was required by the "Department of Defense and Full-Year Continuing Appropriations Act, 2011" and notes that premiums will rise for two out of three small businesses. Access the report by clicking here.   
Speaker's Minute: New ObamaCare Report & Stop Government Abuse
Speaker's Minute: New ObamaCare Report & Stop Government Abuse

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