Here Are 6 Ways a New Report Devastates the $15 Minimum Wage

From The Daily Signal.com (July 11):

Just in time for next week’s likely House vote on a federal $15 minimum wage, the nonpartisan Congressional Budget Office has come out with a caustic report on the consequences of the policy.

The report confirms what even liberal economists caution: A $15 minimum wage would “risk undesirable and unintended consequences” and lead to a survival-of-the-fittest labor market, where only the highest-skilled workers come out on top. 

Democrats are under the illusion that the government can force employers to artificially increase wages with no adverse consequences for American workers. But that’s like saying the government could double families’ mortgage and rent payments without any consequence.

Here are six ways this new report exposes the minimum wage proposal as bad policy.

1. It would be a job-killer.

The Congressional Budget Office report estimated that a $15 minimum wage would lead to 1.3 million lost jobs by the year 2025, with job losses rising over time due to compounding negative impacts.

The exact number of job losses are highly uncertain, but the report says losses would most likely range between zero and 3.7 million, with a not-insignificant chance that losses could exceed 3.7 million.

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2. It would create a survival-of-the-fittest labor market.

The report makes clear that a $15 minimum wage would disproportionately harm workers with the least education and experience and those with disabilities because these workers would be the first to be let go—or to never be hired in the first place.

Under a $15 minimum wage, only workers who can produce at least $35,000 of value per year would be employable. That’s a high hurdle for anyone who lacks experience, doesn’t have an advanced education, can’t speak English, or has a disability.

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3. It would expedite the pace of automation.

When workers become more expensive to employ, companies have a greater incentive to invest in machinery to eventually replace employees.

With a $15 minimum wage in addition to an Obamacare penalty for failing to provide workers with insurance, plus federally mandated taxes and benefits, the minimum cost of employing a full-time worker would exceed $38,000.  [read more]

The other three ways are:

1. It would drive up prices.
2. It would shrink the economy, and shrink family incomes.
3. It would drive up deficits, inflation, and interest rates.