President Biden defended his administration’s call to raise the minimum wage to $15 an hour during tonight’s town hall.
“The vast majority of the economists and there are studies that show by increasing the minimum wage to $15 an hour, it could have an impact on a number of businesses, but it would be de minimis, et cetera. Here’s the deal. It’s about doing it gradually,” Biden said.
Raising the federal hourly minimum wage to $15 would reduce poverty — but would also cut employment by 1.4 million workers and increase the federal deficit by $54 billion over a decade, according to a Congressional Budget Office report released Monday.
Last week’s CBO report resurfaced longstanding arguments between Democrats and worker advocates on one side, who say that paying people a higher wage will have a positive impact on their lives, the federal budget and the economy, and Republicans and business owners on the other side, who warn that such a move will cost jobs.
One recent study by the National Bureau of Economic Research concluded that 80% of economic research over the last 30 years found there are job losses associated with a higher minimum wage. The evidence of a negative impact is stronger for teens and young adults, as well as the less-educated.
But proponents argue that better-quality studies tend to show that increases in the minimum wage do not hurt employment. Supporters for raising the minimum wage also highlighted the CBO’s findings that raising the minimum wage would help many lower-income Americans, many of whom are essential workers, people of color and women.
Biden pushed back against the CBO report, telling CNN’s Anderson Cooper Tuesday, “there are an equal number of studies that say it wouldn’t have that effect. And particularly in terms of how gradually you do it,” adding, “I think there is equally as much, if not more evidence to dictate that it would grow the economy and, long run and medium run, benefit small businesses as well as large businesses, and it would not have such a dilatory effect, but that’s a debatable issue.”
Still, Biden told Randy Lange, the co-owner of a Wisconsin Woodworking Company, “it’s not illegitimate as a small business person to worry about whether or not increasing it at one fell swoop would have that impact.”
Watch the moment: