Progressive-Democrats want to raise the national minimum wage to $15/hr. Here are some back of the envelope numbers that could result.
The CBO says that the new minimum would cost 1.3 million Americans their jobs (in the optimistic scenario; their more pessimistic scenario had 3.7 million Americans put out of work): their current wage would go from $10.10/hr (CBO’s 2014 minimum wage which formed the core of their that-year outcome analysis) to $0.00/hr. The CBO also says that the $15/hr minimum wage would lift 1.3 million American workers out of poverty.
So, 1.3 million, or many more, Americans would lose their jobs so 1.3 million, at best, could get above poverty.
There’s more to it than that, though.
Based on that same $10.10/hr prior minimum that the Progressive-Democrats tried for just five years ago, the currently proposed job losses would result in a bit over $26.25 billion dollars lost to our economy per year through lost wages. That’s based on only 1.3 million American workers being fired, mind you. Balancing that would be that $4.9/hr raise (because, by CBO assumption, $15/hr is a non-poverty wage) for the lucky 1.3 million, or a skosh under $12.75 billion inserted into our economy each year. That’s a net loss to our economy of some $13.5 billion per year.
If we adjust all of that for the actually extant minimum wage of $7.25/hr, the numbers shift to $19.5 billion per year lost to our economy in lost wages from those 1.3 million being fired, and a gain for the lucky ones of $20.2 billion per year.
That makes the Progressive-Democrats’ latest proposal a wash on wages in our economy. Tell that wash business to the fired workers, though, and hear what they think of break-even. Oh, and what was that, again, about “livable wages?”