Tuesday, May 7, 2019

Report: Minimum Wage Hike Could Cost Wisconsin at Least 350,000 Jobs

Increasing the minimum wage to $15 per hour could cost Wisconsin at least 350,000 jobs, according to a new report published by the conservative think tank, the Badger Institute, reports Watchdog.org.

According to the analysis, “a high proportion of the state’s workers – fully 38 percent – earn less than $15 an hour. Our modeling suggests that almost one-third of this group would be at risk of losing their jobs were Wisconsin to quickly increase the minimum wage – which amounts to 350,000 workers.”

Increasing the minimum wage to $15 an hour is “tantamount to an hourly pay increase of 107 percent for workers currently earning the minimum wage,” which is unsustainable for employers, the analysis argues.

The Badger Institute argues that employers in Wisconsin would try to economize in the new high-wage environment “not just by laying off the youngest and/or least productive workers but by reducing the hours of those who remain on the payroll.”

The report notes:
[W[hile Madison and Milwaukee (as well as the portion of southeastern Wisconsin that can be considered a part of the Chicago suburbs) have robust labor markets and a wage distribution above the national norm, the rest of the state has relatively low wages — a function both of the low cost of living as well as a paucity of employers seeking high-skilled workers. The proportion of people there earning at or below $15 an hour dwarfs what holds in those other communities. 
From the report:

In late March, Michigan officially raised its minimum wage to $9.45, while Illinois plans to incrementally increase its current wage of $8.25 to $15 per hour by 2025.

About 57 percent of Wisconsin voters support an further increase in the minimum wage, according to the Marquette Law School poll released April 12.


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