(CNSNews.com) --The nonpartisan Congressional Budget Office (CBO) reports that, while a proposed bill to raise the federal minimum wage to $15 per hour would raise wages for 27 million people, it would also cause 1.3 million people to lose their jobs.
In January, Democrats introduced the Raise the Wage Act (H.R.582), a bill that would boost the federal minimum wage to $15 an hour by 2024. On Monday, the CBO released a report on “The Effects of Employment and Family Income of Increasing the Federal Minimum Wage.”
According to the CBO’s analysis, the $15 minimum wage would raise wages for 27 million and lift 1.3 million Americans out of poverty – but, would make another 1.3 million Americans unemployed:
“In an average week in 2025, the $15 option would boost the wages of 17 million workers who would otherwise earn less than $15 per hour. Another 10 million workers otherwise earning slightly more than $15 per hour might see their wages rise as well. But 1.3 million other workers would become jobless, according to CBO’s median estimate. There is a two-thirds chance that the change in employment would be between about zero and a decrease of 3.7 million workers. The number of people with annual income below the poverty threshold in 2025 would fall by 1.3 million.”
The CBO also predicts that total inflation-adjusted real family income would decrease by 0.1%. Additionally, the wage hike could “reduce business income and raise prices” and “reduce the nation’s output slightly.”
When the Raise the Wage Act was introduced, CNBC reported that, while the National Restaurant Association opposes the bill because restaurants would “be forced to hire fewer people, reduce hours, or even close their doors,” bill co-sponsor Representative Bobby Scott (D-Va.) claimed the proposal would be “good for workers”:
“Raising the minimum wage is not only good for workers, it is good for businesses, and good for the economy. When we put money in the pockets of American workers, they will spend that money in their communities. This bill is a stimulus for Main Street America.”
The House may take up the measure in July, CNBC reported on Monday.