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CBO: Raising the minimum wage to $10.10 an hour could eliminate 500,000 jobs by 2016
Hotair ^ | 02/18/2014 | AllahPundit

Posted on 02/18/2014 4:27:11 PM PST by SeekAndFind

I’m treating it as good news. At least 500,000 people won’t have to worry about “job-lock” now.

There’s no problem here that indefinite unemployment benefits can’t solve, my friends.

Once fully implemented in the second half of 2016, the $10.10 option would reduce total employment by about 500,000 workers, or 0.3 percent, CBO projects (see the table below). As with any such estimates, however, the actual losses could be smaller or larger; in CBO’s assessment, there is about a two-thirds chance that the effect would be in the range between a very slight reduction in employment and a reduction in employment of 1.0 million workers

The increased earnings for low-wage workers resulting from the higher minimum wage would total $31 billion, by CBO’s estimate. However, those earnings would not go only to low-income families, because many low-wage workers are not members of low-income families. Just 19 percent of the $31 billion would accrue to families with earnings below the poverty threshold, whereas 29 percent would accrue to families earning more than three times the poverty threshold, CBO estimates.

Moreover, the increased earnings for some workers would be accompanied by reductions in real (inflation-adjusted) income for the people who became jobless because of the minimum-wage increase, for business owners, and for consumers facing higher prices.

So more than 80 percent of the gains in earnings will go to people other than the very poorest, and meanwhile as many as a million people potentially could end up being laid off. When you net out all the income created and lost by this disruption, says CBO, you come up with a modest gain of $2 billion, or about what the feds spend in four hours on a given day. AEI’s Michael Strain visualizes the trade-off this way:

CBO: Raise the min wage by 40%, total employment falls by 0.3%.

— Michael R. Strain (@MichaelRStrain) February 18, 2014

And as icing on the cake, per CBO, while hiking the minimum wage would reduce deficits slightly in the near term, it would have the opposite effect as the timeline gets farther out. I realize there’s an apples-and-oranges element in comparing this to workers voluntarily leaving the labor force under ObamaCare, but put the two together and we’re now looking at three million jobs disappearing from Obama initiatives on top of the many millions that disappeared over the past five years during and after the recession. What exactly is our employment target at this point?

TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: cbo; jobs; minimumwage; unemployment

1 posted on 02/18/2014 4:27:11 PM PST by SeekAndFind
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To: SeekAndFind

Obama is not at all worried about how his “policies” will hurt the average American. He HATES Americans just as much as he HATES America. His words and his actions are evidence of that.

I defy anybody to prove me wrong.

2 posted on 02/18/2014 4:41:03 PM PST by Howie66 (John Wayne McCornyn...he's just like US! Honest!)
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To: SeekAndFind

Not according to Kathleen Sebelius, a close confidant of President Barack Obama. According to her, the policies of our Dear Leader cannot destroy jobs, they can only create them. And they are going to do so in wonderous abundance creating happiness, prosperity, and progress.

Do not believe these naysayers and evil doers. Obama is the Answer, he is the Light, he is the Future. If you say it is so, it will be so. Believe it.

Isn’t fantasy wonderful?

3 posted on 02/18/2014 4:41:41 PM PST by centurion316
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To: SeekAndFind
When is it time for “tough love?” I mean we could raise the minimum wage to $25/hour and kill lots more jobs. It makes even more “no sense,” but the mob wants symbolism.
4 posted on 02/18/2014 4:49:17 PM PST by Robert357 (D.Rather "Hoist with his own petard!"
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To: SeekAndFind

Obama raising the minimum wage will create jobs! He wants to increase minimum wage 39 percent by 2016 to $10.10/hour. Lots of seniors on fixed income (S.S.) won’t be able to afford the 39 percent inflation in cost of living, and will need to find jobs. What? Needing jobs isn’t the same as finding jobs… Never mind.

5 posted on 02/18/2014 6:27:43 PM PST by roadcat
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To: roadcat

And we all know how on the money the CBO has been. Supposedly they are non partisan. My guess is not a one is being audited, the masters are pleased.

6 posted on 02/18/2014 6:59:52 PM PST by DAC21
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To: DAC21

Obama...the gift that keeps on giving...

7 posted on 02/18/2014 7:27:20 PM PST by jsanders2001
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