The nonpartisan Congressional Budget Office said Monday that raising the federal minimum wage to $15 an hour, up from the current rate of $7.25 a hour, would likely cause 1.3 million people to lose their jobs.
This would erase the overall benefits of the higher wage, with family income falling by $9 billion or about 0.1%, adjusted for inflation.
The report comes as Democrats in Congress are pushing to more than double the federal minimum wage. House Democrats are expected to vote on the Raise the Wage Act, which would raise the rate to $15 by 2024, before the August recess
The agency's analysis found that while the poorest would benefit from the effort, most others would see losses. The increase would raise the pay of about 17 million workers currently below the $15 level and another 10 million workers slightly above it, but this would be offset by the reduction in income for families above the poverty line due to fewer jobs, higher prices, and loss in income for business owners.
"CBO estimates that families whose income would be below the poverty threshold under current law would receive an additional $8 billion in real family income in 2025 under this option. That would amount to a 5.3% increase in income, on average, for such families. That extra income would move, on net, roughly 1.3 million people out of poverty. Real income would fall by about $16 billion for families above the poverty line," the report found.
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