National Edition

CBO report estimates job losses from wage hike, even as Walmart signals possible shift

Published: Friday, Feb. 21 2014 2:50 p.m. MST

Most low-wage workers, she argues, are either teenagers, often from higher income homes, or family members working part time for extra income.

And Mathur may have a point. CBO projects that increased earnings to low-wage workers from the $10.10 minimum wage hike would total $31 billion, but just 19 percent of that would go to families below the poverty line. Households at more than three times the poverty rate would get 29 percent of the benefit, the CBO report states.

Mathur argues that if the goal is to alleviate poverty, the better solution is to bolster the Earned Income Tax Credit, which gives targeted cash assistance to low-income households directly without creating collateral benefits for those who are already better off.

But to Unz, further increasing government benefits simply allows businesses to shunt the real cost of their operations off onto taxpayers. Opponents of higher wage laws, Unz argues, claim to be concerned about job losses, “but their real concern is the bottom line of business lobbies that want to drive down the wages of Americans to lowest point possible.”

Holding out

“A minimum wage increase is not a real, comprehensive solution to poverty and the problems of income inequality in this country," said Scott DeFife, head of policy and government affairs at the National Restaurant Association, which has so far resisted Wamart’s example to embrace higher wage laws.

"There is no clearer example of that than in the restaurant industry,” DeFife said, “where the vast majority of people who make the minimum wage are working part time, and are teens or young adults who are likely to be supplementing a family income."

DeFife and Mathur both argue that serious jobs and poverty policies should look at education and job training, rather than attempting to fix the value of labor.

“The restaurant industry provides real pathways to the middle class and beyond, and dramatic increases in the minimum wage will only hinder our ability to provide stepping stones for those who need it most,” DeFife said.

Email: eschulzke@desnews.com

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