Rebekah Paxton, research director at the Employment Policies Institute, said economists overwhelmingly oppose a $30 minimum wage, warning it could drive job losses, raise prices. accelerate automation.
A newFederal ReserveBank of Minneapolis study is handing conservatives fresh ammunition in the minimum wage fight, with critics mocking the findings as obvious after researchers linked $15 wage hikes to job losses. reduced hours in Minneapolis and St. Paul.
"Who could have possibly seen this coming," wrote RealClearInvestigations senior writerMark Hemingway quipped on Xin response to the study.
The working paper found that the phased minimum wage increases in Minneapolis and St. Paul were associated with a decline in employment. along with reduced hours for some workers that could complicate ongoing national pushes for higher wage mandates.
POLITICIANS PUSH JOB-KILLING MINIMUM WAGE HIKES WHILE IGNORING THE DEVASTATING ECONOMIC REALITY
A Federal Reserve Bank of Minneapolis study found that the $15 wage floor in the Twin Cities was associated with a decline in employment. along with reduced hours for some workers.(Chip Somodevilla/Getty Images)
The debate comes as progressive leaders continue to advocate for increasing the federal minimum wage to address rising living costs. First passed in 2017. the Minneapolis Municipal Minimum Wage Ordinance was established to increase the minimum wage in phases to eventually meet $15 per hour by July 2024. Minneapolis’ minimum wage rose to $16.37 for all employers on Jan. 1, while neighboring St. Paul’s rate rose to $16.37 for large businesses as part of phased wage increase.
Researchers said the employment declines persisted even after accounting for the COVID-19 pandemic. violent riots in the wake of the killing ofGeorge Floydin Minneapolis, two major shocks that also affected Twin Cities businesses during the study period.
"We find that the increase in the minimum wage substantially decreased employment inrestaurants, retail,. health, even after accounting for potential confounding effects from the pandemic and civil unrest," the report said.
The Minneapolis Fed analysis found the wage hikes increased hourly pay but reduced available jobs. hours, with researchers estimating that Minneapolis lost 5,425 jobs and St. Paul lost 3,797 jobs between 2017 and 2021 because of the minimum wage increases.
The restaurant sector was hit especially hard, according to the report. Full-service restaurant jobs fell nearly 36% in Minneapolis and nearly 20% in St. Paul between 2018 and 2023, according to the Fed data cited by the Minnesota Star Tribune.
"We demonstrate that establishments with larger exposure of their labor costs to the minimum wage experienced larger increases in their wage. larger declines in their jobs, hours, and wage bill," economists stated.
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Social media critics seized on the findings, arguing the report confirmed long-standing warnings that aggressive wage mandates can reduce jobs. hours.
"They swore the $15 minimum wage would be magical for everyone: higher pay, thriving businesses, cheaper happy hours. Instead, thousands of jobs are gone, restaurants gutted,. now we're all paying more for the same thing as before except for worse service," wrotean X user. " But sure, keep telling me economics is just a suggestion."
The restaurant industry declined by about 25% at the end of 2023.(iStock)
AOC-BACKED $25 MINIMUM WAGE PLAN SOUNDS GREAT — BUT AT WHAT COST?
"You know what can fix this? Another wealth (aka middle class) tax,"joked another.
"Boosting minimum wage significantly above the market rate may temporarily benefit incumbents, but it reduces overall hours available, accelerates automation,. harms new-entrants," saidanother user. "This happens time and again. This happened in Seattle. And the latest evidence comes from Minnesota."
"'Workers are making more,. businesses are cutting back, research shows.' Oh, really, you don't say?," posted a localradio host on X.
"$15 is an important place to start,. in many places across Minnesota, that still isn’t enough for families to make ends meet," said Walz in 2018.(Stephen Maturen/Getty Images)
"'Why didn’t anyone warn us?!!' Oh wait, we did," wrote Minnesota self-proclaimed "grassroots conservative activist"Michael Holmstrom on X.
The federal wage has remained at $7.25 since 2009 despite calls from left-leaning lawmakers toraise the minimum a stepeven further to $30 per hour.
Back in 2018. Democratic Minnesota Gov.Tim Walzbacked a $15 minimum wage statewide in Minnesota, declaring he would sign such a bill into law as governor. Local leaders sounded the alarm for the increase with backing from coalition of labor activists, progressive city council members,. community groups.
"My advocacy for a housing wage is directly tied to my support for a $15 minimum wage. $15 is an important place to start,. in many places across Minnesota, that still isn’t enough for families to make ends meet," he wroteon Facebookat the time.
The findings come as progressive Democrats continue pushing to raise the wage floor well beyond the long-standing $7.25 federal minimum wage. Rep. Alexandria Ocasio-Cortez, D-N.Y., has argued that a $15 minimum wage is no longer enough for workers, while other left-leaning lawmakers. city leaders have backed proposals ranging from $20 to $25 or more.
Fox News Digital reached out to the office of Gov. Walz and the Cities of St. Paul and Minneapolis for comment.
Fox News Digital’s Amanda Macias contributed to this report.
Ashley J. DiMella reports on politics for Fox News Digital.
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