15.3 Minimum-Wage Laws

According to the National Federation of Independent Business (NFIB), small businesses do not have the resources to absorb an increase in the minimum wage since most earnings go back into a small company. As a result, they argue, hiring and promoting employees will slow down substantially in that sector. However, the United States Department of Labor reviewed 64 studies on the effects of minimum wage increases and unemployment, finding no correlation between the two [16].

Example: During his 2014 State of the Union address, President Obama urged Congress to increase the minimum wage to $10.10 in 2016. A report from the Congressional Budget Office (CBO) projected that an increase in the federal minimum wage to $10.10 per hour would have resulted in higher paychecks for 16.5 million employees. Of those individuals, 900,000 would rise above the poverty level. On the flip side, if this increase was enacted, it was estimated that 500,000 workers would be released from their jobs, according to the CBO [16].

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