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Labor Secretary Disputes CBO Report that Predicts Fewer Jobs After Minimum Wage Hike

$10.10 remains a priority for Obama along with making employers pay more overtime.

by
Rodrigo Sermeño

Bio

March 14, 2014 - 4:07 pm
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The CBO report says an increase in the minimum wage would substantially boost income for most low-income workers. Nevertheless, those earnings would not go only to low-income families because many low-wage workers are not members of low-income families. Only about one-fifth of the $31 billion in total increased earnings would go to families with incomes below the poverty threshold.

CBO Director Doug Elmendorf told the committee the minimum wage hike would have two effects: most workers would receive higher pay, and some jobs may be eliminated.

He noted this is the “central estimate,” meaning there is a two-thirds probability that the change would create anywhere from a slight reduction in employment to a loss of one million jobs.

“It could be smaller job loss, it could be larger job loss,” Elmendorf said.

He said that nearly one-third of the families that would benefit from the minimum wage hike already earn more than three times the poverty level.

Sen. Elizabeth Warren (D-Mass.) noted that CBO’s report is a “meta-study” that collected hundreds of studies and weighted its findings to come up with an overall estimate of the impact of a minimum wage increase on employment. She said the Center for Economic Policy Research examined every study since 2000 on the effects of the minimum wage and employment and concluded that an increase in the minimum wage has no impact on jobs.

The White House has also criticized the report, saying the job loss estimates were overstated.

According to the White House’s estimates, the wage hike would lift two million workers above the poverty line.

The issue is likely to feature prominently in the 2014 midterm elections as the Democrats try to counter Republican messaging on problems with Obamacare.

President Obama called for an increase in the minimum wage during his State of the Union address. He has made the minimum wage boost a central part of his larger effort to reduce income inequality.

Obama signed an executive order in February that would increase the minimum wage for federal contractors to $10.10 an hour.

On Thursday, Obama ordered the Department of Labor to propose rules that expand the number of employees who benefit from overtime pay. The rules would be aimed at salaried workers who make more than $455 a week and those who are ineligible for overtime pay because they are designated as management.

“Overtime is a pretty simple idea,” Obama said. “If you have to work more, you should get paid more.”

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Rodrigo is a freelance writer living in Washington, D.C.

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Top Rated Comments   
We have a rogue government, consisting of Liars.

Not satisfied with Obama's 9.1% average unemployment over his first term, they seek to hike it again.

Reference: Einstein and insanity.

As though flipping burgers were a career.
31 weeks ago
31 weeks ago Link To Comment
All Comments   (8)
All Comments   (8)
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This has nothing to do with wages, purchasing power or the quality of life of entry level workers. This ONLY about the ability of entry level workers to pay union dues which, in turn, will be used to bribe politicians and government workers.
31 weeks ago
31 weeks ago Link To Comment
my neighbor’s sister makes $62 every hour on the internet . She has been without a job for seven months but last month her income was $17889 just working on the internet for a few hours.
Read Full Article ,,,,,,,,,,,,,,,,,,,,,,,,,,,,, http://www.Fizzjob.Com
31 weeks ago
31 weeks ago Link To Comment
So once again these people show they are either clueless about the economy or willing to lie and destroy the economy for a few political points. The economy readjusts to compensate for new expenses and new wealth. New expenses, like suddenly paying people more money without getting more or better work in return, depresses the economy and the prices of everything rises. New wealth, like producing more oil and lowering fuel prices, stimulates the economy, increases everyone's buying power—including minimum wage workers, and tends to lower prices. It is a simple Economics 101 problem.
31 weeks ago
31 weeks ago Link To Comment
Since "an increase in the minimum wage has no impact on jobs", why not raise the minimum wage to $100 an hour, and eliminate poverty entirely?

If that isn't enough, why not a $million an hour? That way everyone can be rich :)
31 weeks ago
31 weeks ago Link To Comment
We have the most amazingly clueless president ever. Jimmy Carter's looking sharp as a tack right now.
31 weeks ago
31 weeks ago Link To Comment
I don't think he's so clueless. He's a demagogue- seeking to cause rifts among us and exploit them to destroy the country. Burdening the economy just fits right in... push for a raise to help the most needy knowing all the while that it would come at the price of some of their employment.

During his 2008 campaign, Obama attacked Bush characterizing as unpatriotic the addition of $4 trillion to the national debt- which at that point stood at $10 trillion by year's end.

"The problem is, is that the way Bush has done it over the last eight years is to take out a credit card from the Bank of China in the name of our children, driving up our national debt from $5 trillion for the first 42 presidents — #43 added $4 trillion by his lonesome, so that we now have over $9 trillion of debt that we are going to have to pay back — $30,000 for every man, woman and child. That’s irresponsible. It’s unpatriotic." -Barack Obama

However, during his five years in the Oval Office, we've seen the debt increase by $7 trillion... if $9-10 trillion was unpatriotic under Bush, what is $17 trillion under Obama? It's worse than unpatriotic, it's criminal- because he knowingly and willfully added to it- by among other things working to immediately greatly increase the size of the bureaucracy upon being inaugurated- and in doing so increase our need for borrowing. That increase in government size came in the form of Obamacare- demonstrated to be a job killer by design. It also by design causes people to lose their medical coverage... so at least under "unpatriotic" Bush the average working stiff could make payments against his or her $30,000 in national debt but under Obama we'd be stuck with our roughly $55,000 share per capita and we're far less likely to have a full time job to make those payments.

Obamacare was fast tracked through using every parliamentary trick in the book to sidestep debate- "We need to pass the law so that you can find out what's in it" -Nancy Pelosi

They KNEW what the law was all about and they KNEW the likely effects it would have not only on existing insurance policies but also its effects on employment. This is not incompetence, it is evil. The criminal scum that occupies the White House needs to be forcibly removed and made to face charges.
31 weeks ago
31 weeks ago Link To Comment
We have a rogue government, consisting of Liars.

Not satisfied with Obama's 9.1% average unemployment over his first term, they seek to hike it again.

Reference: Einstein and insanity.

As though flipping burgers were a career.
31 weeks ago
31 weeks ago Link To Comment
For some people, that *is* skilled labor.
31 weeks ago
31 weeks ago Link To Comment
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