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$15 minimum wage would cost 45,000 jobs… in just one county: Report

(AP Photo/M. Spencer Green, File)

A county considering raising the minimum wage to $15 per hour commissioned a study on the impacts of the hike, and the results are staggering. It should serve as a wake-up call to other localities considering large increases.

Montgomery County, a Washington D.C. suburb with more than a million residents in southern Maryland, is represented by all Democrats, and their County Council voted 5-to-4 to increase the minimum wage to $15 per hour. County Executive Ike Leggett vetoed the measure in January, and since then, the county commissioned a report on the effects of the increase.

PFM Group Consulting found that an increase to $15 per hour would result in 45,000 fewer jobs, $396.5 million in lost income, and $41 million in lost revenue to the county by 2022.

Even the left-leaning Washington Post Editorial Board called this report “sobering.” Unfortunately, these facts aren’t stopping some county council members. Council member Marc Elrich (D-At Large) has already reintroduced a different version increasing the minimum wage to $15. Fewer jobs, less income, and less revenue apparently aren’t enough to dissuade those motivated by pro-union political forces.

But beyond the impacts in this one county, this report — like the government-commissioned University of Washington (UW) report that found Seattle’s $15 minimum wage would hurt low-wage earners and result in a loss of jobs — ought to stop the momentum of the #FightFor15 movement.

And remember, Seattle and the DC suburbs have high median incomes and flourishing economies. The impact on lower-income areas could be much worse.

Researchers are agreeing: raising the minimum wage too quickly kills jobs and lowers overall income for the workers it is designed to help. Both the UW and PFM reports found benefits of the increase, but it was clear the net impact was negative.

The UW report said, “We conclude that the second wage increase to $13 reduced hours worked in low-wage jobs by around 9 percent, while hourly wages in such jobs increased by around 3 percent. Consequently, total payroll fell for such jobs, implying that the minimum wage ordinance lowered low-wage employees’ earnings by an average of $125 per month in 2016.”

A Harvard analysis also found minimum wage hikes in California have a particularly adverse impact on restaurants. Their report said, “We find suggestive evidence that a higher minimum wage leads to overall increases in restaurant exit rates.” An American Action Forum report found Illinois’ possible minimum wage increase to $15 would kill 328,000 jobs in the state by 2025.

For those who care about empowering low-income Americans and lifting workers out of poverty, the mounting evidence and data show raising the minimum wage to $15 isn’t compassionate, just, or charitable. It kills opportunity and creates more poverty, especially for young Americans trying to build their skill sets and make ends meet.

Those still doing #FightFor15 have important questions to answer: Why are you ignoring evidence that hurts low-wage workers? If you don’t care that it hurts low-wage workers, what are your real motives? Aren’t there other anti-poverty policy measures you can fight for that would be more productive?


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