House Speaker Nancy Pelosi (D-Calif.) speaks during a press conference about the minimum wage on March 11, 2021.
(Photo: Lenin Nolly/NurPhoto via Getty Images)
Mar 11, 2021
Raising the federal minimum wage to $15 an hour would deliver sizable benefits to low-wage workers and lift millions of people in the U.S. out of poverty while having little impact--positive or negative--on employment levels.
So says a new report assembled not by a progressive advocacy organization or a left-leaning think tank, but Wall Street titan Morgan Stanley, which found in a 75-page analysis that--contrary to the GOP's branding of the proposed $15-an-hour federal minimum wage as a job-killer--"the wealth of research points to no definitive conclusion on the impact higher wages have on employment."
"However," the report adds, "it is evident that the impact to employment... would be minimal, while the social benefits to lifting real wages of lower-income earners and millions out of poverty are substantial."
The big bank's analysis of the potential effects of more than doubling the national minimum wage comes after the Senate Democratic leadership stripped a $15 wage provision out of the newly passed coronavirus relief package, citing the unelected Senate parliamentarian's widely disputed advisory opinion that the proposed pay hike ran afoul of the chamber's reconciliation rules.
As progressive lawmakers vow to continue fighting for the long-overdue pay increase, Morgan Stanley's economic team envisioned "limited impact to broader equity earnings, GDP, and consumption, but important implications for poverty reduction" should Congress ultimately approve a $15 federal minimum wage.
The bank's analysts argued that while its implications for growth, employment, and other broad economic metrics would likely be marginal, a $15 minimum wage would have a "major impact on a portion of the workforce... with a higher minimum wage lifting millions of workers out of poverty and reducing government expenditures on public assistance programs significantly."
\u201cWall street analysts seem quite sanguine about the idea of a higher minimum wage actually. Via @MorganStanley\u201d— Lydia DePillis (@Lydia DePillis) 1615477752
In its conclusion that a $15 federal minimum wage would provide a major boost to workers currently struggling to survive on starvation-level wages, Morgan Stanley's report was in line with an analysis released earlier this week by the left-leaning Economic Policy Institute (EPI), which found that the pay hike would "raise the pay of essential and frontline workers" and "reduce the number of people living in poverty."
Implementing a $15 minimum wage by 2025 as proposed by the Raise the Wage Act would lift 3.7 million people in the U.S. out of poverty, according to EPI.
"Raising the minimum wage is a no-brainer," said David Cooper, a senior economic analyst at EPI.
Join Us: News for people demanding a better world
Common Dreams is powered by optimists who believe in the power of informed and engaged citizens to ignite and enact change to make the world a better place. We're hundreds of thousands strong, but every single supporter makes the difference. Your contribution supports this bold media model—free, independent, and dedicated to reporting the facts every day. Stand with us in the fight for economic equality, social justice, human rights, and a more sustainable future. As a people-powered nonprofit news outlet, we cover the issues the corporate media never will. Join with us today! |
Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.
Raising the federal minimum wage to $15 an hour would deliver sizable benefits to low-wage workers and lift millions of people in the U.S. out of poverty while having little impact--positive or negative--on employment levels.
So says a new report assembled not by a progressive advocacy organization or a left-leaning think tank, but Wall Street titan Morgan Stanley, which found in a 75-page analysis that--contrary to the GOP's branding of the proposed $15-an-hour federal minimum wage as a job-killer--"the wealth of research points to no definitive conclusion on the impact higher wages have on employment."
"However," the report adds, "it is evident that the impact to employment... would be minimal, while the social benefits to lifting real wages of lower-income earners and millions out of poverty are substantial."
The big bank's analysis of the potential effects of more than doubling the national minimum wage comes after the Senate Democratic leadership stripped a $15 wage provision out of the newly passed coronavirus relief package, citing the unelected Senate parliamentarian's widely disputed advisory opinion that the proposed pay hike ran afoul of the chamber's reconciliation rules.
As progressive lawmakers vow to continue fighting for the long-overdue pay increase, Morgan Stanley's economic team envisioned "limited impact to broader equity earnings, GDP, and consumption, but important implications for poverty reduction" should Congress ultimately approve a $15 federal minimum wage.
The bank's analysts argued that while its implications for growth, employment, and other broad economic metrics would likely be marginal, a $15 minimum wage would have a "major impact on a portion of the workforce... with a higher minimum wage lifting millions of workers out of poverty and reducing government expenditures on public assistance programs significantly."
\u201cWall street analysts seem quite sanguine about the idea of a higher minimum wage actually. Via @MorganStanley\u201d— Lydia DePillis (@Lydia DePillis) 1615477752
In its conclusion that a $15 federal minimum wage would provide a major boost to workers currently struggling to survive on starvation-level wages, Morgan Stanley's report was in line with an analysis released earlier this week by the left-leaning Economic Policy Institute (EPI), which found that the pay hike would "raise the pay of essential and frontline workers" and "reduce the number of people living in poverty."
Implementing a $15 minimum wage by 2025 as proposed by the Raise the Wage Act would lift 3.7 million people in the U.S. out of poverty, according to EPI.
"Raising the minimum wage is a no-brainer," said David Cooper, a senior economic analyst at EPI.
Raising the federal minimum wage to $15 an hour would deliver sizable benefits to low-wage workers and lift millions of people in the U.S. out of poverty while having little impact--positive or negative--on employment levels.
So says a new report assembled not by a progressive advocacy organization or a left-leaning think tank, but Wall Street titan Morgan Stanley, which found in a 75-page analysis that--contrary to the GOP's branding of the proposed $15-an-hour federal minimum wage as a job-killer--"the wealth of research points to no definitive conclusion on the impact higher wages have on employment."
"However," the report adds, "it is evident that the impact to employment... would be minimal, while the social benefits to lifting real wages of lower-income earners and millions out of poverty are substantial."
The big bank's analysis of the potential effects of more than doubling the national minimum wage comes after the Senate Democratic leadership stripped a $15 wage provision out of the newly passed coronavirus relief package, citing the unelected Senate parliamentarian's widely disputed advisory opinion that the proposed pay hike ran afoul of the chamber's reconciliation rules.
As progressive lawmakers vow to continue fighting for the long-overdue pay increase, Morgan Stanley's economic team envisioned "limited impact to broader equity earnings, GDP, and consumption, but important implications for poverty reduction" should Congress ultimately approve a $15 federal minimum wage.
The bank's analysts argued that while its implications for growth, employment, and other broad economic metrics would likely be marginal, a $15 minimum wage would have a "major impact on a portion of the workforce... with a higher minimum wage lifting millions of workers out of poverty and reducing government expenditures on public assistance programs significantly."
\u201cWall street analysts seem quite sanguine about the idea of a higher minimum wage actually. Via @MorganStanley\u201d— Lydia DePillis (@Lydia DePillis) 1615477752
In its conclusion that a $15 federal minimum wage would provide a major boost to workers currently struggling to survive on starvation-level wages, Morgan Stanley's report was in line with an analysis released earlier this week by the left-leaning Economic Policy Institute (EPI), which found that the pay hike would "raise the pay of essential and frontline workers" and "reduce the number of people living in poverty."
Implementing a $15 minimum wage by 2025 as proposed by the Raise the Wage Act would lift 3.7 million people in the U.S. out of poverty, according to EPI.
"Raising the minimum wage is a no-brainer," said David Cooper, a senior economic analyst at EPI.
We've had enough. The 1% own and operate the corporate media. They are doing everything they can to defend the status quo, squash dissent and protect the wealthy and the powerful. The Common Dreams media model is different. We cover the news that matters to the 99%. Our mission? To inform. To inspire. To ignite change for the common good. How? Nonprofit. Independent. Reader-supported. Free to read. Free to republish. Free to share. With no advertising. No paywalls. No selling of your data. Thousands of small donations fund our newsroom and allow us to continue publishing. Can you chip in? We can't do it without you. Thank you.