New study contradicts White House minimum wage report

New study contradicts White House minimum wage report

Would raising the minimum wage help or hinder women in the labor force?

In March, the White House released a report touting the expected beneficial impacts hiking the federal minimum wage would have on working women. However, findings in a new study published by the Employment Policies Institute suggest that mandating higher federal wages would, on the contrary, adversely impact female workers.

President Barack Obama’s economic advisers predicted that bumping minimum hourly pay from the current federal standard of $7.25 an hour to $10.10 an hour would help women work their way above the poverty line and into the middle class.

And among other forecasts, White House economists argued that a legislated wage increase would make progress toward closing the gender pay gap.

EPI’s calculations call the Obama Administration’s prognosis into question. Of the 500,000 jobs that the nonpartisan Congressional Budget Office recently estimated would be eliminated from the labor force with the proposed wage hike, EPI and economists from Miami and Trinity University found that 285,000 (56.8%) of the jobs would be lost by women. Said Michael Saltsman, the research director at EPI:

President Obama’s right that women should be concerned about the minimum wage — especially if they’re one of the 258,000 who will lose their job if $10.10 becomes a reality.

The downturn in the availability of low-skilled jobs would likely be a result of businesses cutting hours or staff due to the increased payroll costs.

Saltsman told The Daily Caller News Foundation that the Democrats’ campaign to raise the minimum wage may be less about passing economically sound policy and more about winning elections:

There are better ways to boost wages that don’t involve a half-million lost jobs. Unfortunately, this election-year push for $10.10 is all about helping politicians, not helping workers.

Efforts to raise the minimum wage have gained momentum since the Obama’s 2014 State of the Union address, when he vowed to defeating income inequality a center point of his presidency.

Recognizing that any legislation mandating wage hikes was unlikely to pass through the Republican-controlled House, Obama urged states to bypass Congress and implement higher state minimum wages.

A growing number of states have been heeding the president’s request. So far in 2014, Connecticut and Delaware have raised their state minimum wage and another 30 states are considering doing the same.

This report, by Breanna Deutsch, was cross-posted by arrangement with the Daily Caller News Foundation.


LU Staff

LU Staff

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