$7.25 per hour. That’s the current federal minimum wage, a number that has not changed in more than a decade despite calls from the public and lawmakers, including former President Barrack Obama.
In fact, in 2019, the Democrat-majority U.S. House of Representatives passed a bill known as Raise the Minimum Wage Act, which called for an increase to $15 per hour by the year 2025. However, the Republican-majority Senate has yet to take up the bill on the floor. But now, with Democrat Joe Biden expected to begin his presidency on January 20, 2021, there’s renewed hope among supporters that this could soon become reality.
Let’s take a look at why this could and could not happen, and what workers can actually expect if the minimum wage almost doubles.
Will it Happen? In the Near-Term, it Hinges on the Senate
Senate Majority Leader Mitch McConnell declined to take up the House-passed Raise the Minimum Wage Act in 2019, and it’s unlikely that this will change as long as Republicans are the majority party in the upper chamber of Congress. However, both Senate races in Georgia are going to runoff elections early next year, with the winners deciding control.
If Democrats pick up both seats – which seems unlikely – then this bill would be highly likely to pass. If Republicans retain control of the Senate, Democrats will likely have to wait until the 2022 mid-term elections to make another attempt. However, it’s also worth noting that mid-term elections almost always favor the party opposite of the current U.S. President, meaning this would be a tall task for Democrats.
Pros and Cons of $15 Minimum Wage
Per a study from the Congressional Budget Office, an increase to $15 minimum wage by 2025 would increase the paychecks of roughly 30 million Americans, and move 1.3 million Americans out of poverty. Those are the two major benefits associated with a minimum wage increase. What’s more is there seems to be support for this increase in pockets throughout the country. Eight states have already passed legislation to make their respective minimum wages $15 an hour, with latest to do so being Florida, and a Pew Research Center survey said that about two-thirds of all Americans support such an initiative.
However, there are some drawbacks as well. Notably, how it’s projected that more than 1 million workers might find themselves out of work due to the higher required minimum wage’s impact on businesses. And those that are likely to be most impacted include teens, part-time workers and those without a college degree or secondary education, the latter group of which this Act is more specifically designed to help. Essentially, young and low-skilled workers will be effectively priced out of the labor market.
Democrats and Republicans would be better served finding a compromise to raise the standard of living for working-class Americans. Unfortunately, considering the political climate, this seems impossible at the time of writing.