Opponents of measures to increase federal and state minimum wages have long said higher wages will cost the country jobs and economic growth. Well, a recent Bloomberg report debunks that theory.
The article points to Washington state, where residents in 1998 voted to raise the state’s minimum wage and link it to the cost of living.
Years later, warnings of stagnant growth have yet to play out.
“In the 15 years that followed, the state’s minimum wage climbed to $9.32 — the highest in the country,” reads the report. “Meanwhile job growth continued at an average 0.8 percent annual pace, 0.3 percentage point above the national rate. Payrolls at Washington’s restaurants and bars, portrayed as particularly vulnerable to higher wage costs, expanded by 21 percent. Poverty has trailed the U.S. level for at least seven years.”
The same debate is now playing out on the national level as President Obama pushes to increase the federal minimum wage from $7.25 per hour to $10.10 per hour. Opponents today continue to fling the same tired arguments of no jobs, no growth. But “Washington’s example shows that any such effects aren’t big enough to throw its economy and labor market off the tracks,” says the report.
Raising the federal minimum wage would reduce national employment by 0.3 percent, says a new Congressional Budget office report, but it would also pull 900,000 people out of poverty and add $31 billion to low-wage worker incomes. And according to the Center for American Progress, increasing the federal minimum wage would provide a 6 percent reduction in food stamp expenditures.
For more information, read Bloomberg’s article “Highest Minimum-Wage State Washington Beats U.S. Job Growth” by clicking here.