Fast Facts on Minimum Wage Increases

fast-facts-on-minimum-wage-increases

Many fast food CEOs have come out against raising the minimum wage. Not only have these top executives come out against minimum wage, but they have actively campaigned against raising wages based on a series of arguments that hold little actual value. Let’s assume that maybe these business leaders haven’t seen the piles of reports and data proving their claims to be wrong.

This quick fact check should help them clear up some of the biggest concerns/lies/myths RE: raising wages…

Nigel Travis has called the idea of raising minimum wage, “absolutely outrageous.” Well, actually, his claims that raising wages forces layoffs have been widely researched. Most recently, National Employment Law Review (NELP) released a report that studied wage increases over the last 68 years and found no correlation between wage increases and job losses.

To quote the report, “The results were clear: these basic economic indicators show no correlation between federal minimum-wage increases and lower employment levels, even in the industries that are most impacted by higher minimum wages. ”

In his open letter to the labor movement, former CEO of McDonald’s USA Ed Rensi spends a lengthy amount of time classifying low wage workers as unskilled young kids. This classic image of the minimum wage worker as a teenager is often used by opponents of raising wages. But here’s the problem: recent studies show that low wage workers are now older, educated, more diverse, and often heads of families. According to the Economic Policy Institute, a whopping 88% of minimum wage workers are at least 20 years old, and 36% are 40 or older. Full time low wage workers deserve the dignity of being able to support themselves and their family without subsidizing pay with welfare or additional jobs.

CEO of CKE Restaurants (most popular for Carl’s Jr.) Andy Pudzer told Fox News that according to a Congressional Budget Office report on raising the minimum wage to $10.10/hour, 500,000 people would lose their jobs. On this, Pudzer was correct. However, Pudzer used this fact to prove his claim that he was not for “killing jobs,” and left out the rest of the report. In the CBO report, it goes on to say that while 500,000 people would lose their jobs, 16.5 million would gain a raise. Yes, some additional labor costs will create fringe effects of job losses.

However, keep in mind that 16.5 million people would be given the boost of additional income. More money in the pockets of individuals means more spending and a stronger economy with more job opportunties. Add to this the idea of an indexed minimum wage, and employers could actually predict labor cost with more certainty and hire staff with more confidence and job security.

To be fair, not all fast food CEOs are so naive about the stats on granting a living wage.

CEO of Popeyes Louisiana Kitchen, Cheryl Bachelder pointed out that just as giants in the retail industry have adjusted to wage increases, so will the fast food industry. In her words, “life goes on.” And in this case, a minimum wage increase means that life will go with more dignity and security for millions of Americans.

 

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