By H. Harrison Coleman
As the Biden administration establishes itself, debates have flared up over a specific part of President Biden’s plan for economic recovery: the institution of a $15 minimum wage. Despite the evidence to the contrary, many—mostly those on the right—have slammed the idea, decrying the move as “radical” and an undue weight on small businesses. This simply is wrong, and in fact the opposite is true—raising the minimum wage to $15 is exactly what this country needs.
First off, it’s best to clarify what the current plan to raise the wage is. Biden’s plan would not immediately raise the minimum wage from its current $7.25 per hour to $15. It would be incrementally raised over the course of a few years, as per the Raise the Wage Act, the bill that would accomplish this feat. The act raises the minimum wage to $15 by 2025, and after that, the minimum wage would be adjusted every year afterwards, in accordance with the national median wage growth in order to keep the minimum wage a liveable one, as it was always intended to be. Additionally, the infamous tipped-worker loophole would finally be terminated by this act.
The benefits of raising the wage are undeniable. A study by the Economic Policy Institute shows that raising the national minimum wage to $15 would raise wages for 33.5 million Americans, 23 million of whom would directly benefit (the remaining 10.5 million stand to gain from increased bargaining power). This study, conducted on the 2019 version of the Raise the Wage Act, found that over 30 million Americans 20+ years old, 9.4 million working parents and 6.1 million workers currently in poverty stand to gain increased wages. Further, an increase to $15 per hour nationally would directly lift over 1.3 million people out of poverty.
That being said, raising the minimum wage to $15 per hour would not come without downsides. A report by the Congressional Budget Office posited that such an increase in the federal minimum wage would result in 1.3 million people losing their jobs. It’s impossible to sugarcoat this reality, but that does not offset the benefits gained from increasing the minimum wage.
One of the most common arguments against raising the federal minimum wage is that it’s a matter best left to the individual and diverse states. That’s a good argument—and it would be a lot harder to argue with if some states weren’t absurdly hostile to workers’ rights. Take Georgia, with its minimum wage of $5.15. Of course, because the federal minimum supersedes the state’s, workers there (and in Wyoming, also with a $5.15 minimum wage) make the national $7.25 per hour. Additionally, 13 states keep the insufficient $7.25 per hour, and the states of Louisiana, Tennessee, South Carolina and Mississippi have no minimum wage at all.
This all goes to show that, while in theory leaving the matter up to the states is a good idea, it fails to pan out in reality because not all states act in the interest of their working citizens—especially when state legislators are being lobbied by the corporations that stand to benefit from shorting their workers—and that it’s left to the federal government to protect the workers of those places with a reasonable minimum wage: say, fifteen dollars per hour?
To those who worry that small businesses might not be able to handle an increase to $15 per hour—don’t be. In the Januaries of 2020 and 2021, when the minimum wages in states all across the country increased, most small businesses said that the increases had no impact on them at all. In places like New York and California, two states with very high minimum wages, small businesses actually grew faster than their counterparts who used the federal minimum of $7.25.
If you don’t believe this, just compare Utah (minimum wage of $7.25) to the state of Washington (minimum wage of $12). Washington reported more workers—as a percent of the working population—worked in small businesses and added around 40,000 more small-business jobs than Utah did in the same timeframe.
Even if the federal minimum wage remains stagnant, as it has since 2009, many Americans will soon live in a state with a $15 minimum wage. Nine states are planning to raise their minimum wages to $15 per hour- California in 2022, Massachusetts and Connecticut in 2023, New Jersey in 2024, Illinois and Maryland in 2025, and Florida by 2026. New York and Virginia plan to raise their minimum wages to $15 per hour at unspecified dates in the future.
Another concern many have is that the prices of goods would drastically increase under a $15 minimum wage. An outrageous claim by Jordan Rachel, a speaker for the ultraconservative and corporately-funded advocacy group Turning Point USA, claimed that Taco Bell tacos would cost $38 under President Biden’s minimum wage plan. In response, the Austin American-Statesman published a very well written rebuke and explanation, finding that in San Francisco, CA, where the minimum wage is $16.07 per hour, many Taco Bell items are only marginally (to the tune of 7%) more expensive than in places where the minimum wage is $7.25. They also made the astute observation that because only a relatively small percentage of an item’s cost derives from the cost of labor, and that factors like land prices and miscellaneous taxes (ie, a soda or sugar tax) are so much larger in urban centers like San Francisco, that even those estimates of a 7% price increases are inflated, compared to the possibility of a national $15 minimum wage.
Moreover, in an Oxfam analysis of the best states to work in, a clear divide can be seen in a state’s minimum wage and how good of a place to work it is. In the New England region, all the states there score very well; with the exception of New Hampshire (placing 25th). It’s unsurprising to know that in all the states that comprise New England, New Hampshire is the only one to use the federal minimum wage of $7.25. In the South, the best states to work in are Arkansas (min. wage of $11) and Florida, which recently voted to raise its minimum wage to $15 by 2026 (the current minimum wage there is $8.56, to become $10 this September). Georgia, with its unimpressive $5.15 per hour, ranks 51st, losing the uncoveted 52nd spot to neighboring North Carolina (min. wage of $7.25).
It’s plain as day to see. Raising the minimum wage gradually from its current paltry $7.25 per hour to a national $15 per hour, while it may have its drawbacks, is absolutely worth it. A federal $15 minimum wage would improve labor standards, protect workers from their statehouses and raise untold millions into better lives.