Content starts here

CBO Report Offers Mixed Message on Minimum Wage Hike

A new report by the Congressional Budget Office offers fodder for both sides of the debate about raising the nation's $7.25-an-hour minimum wage.

Kitchen Worker Series

Democrats are cheering the nonpartisan agency's finding that a proposal to raise the minimum wage to $10.10 would lift about 900,000 low-wage workers out of poverty. But Republicans say that what's important is the report's estimate that 500,000 jobs would disappear as businesses adjust to the new wage.

The CBO found smaller impacts from a wage hike to $9 - what President Barack Obama proposed before Senate Democrats moved ahead with a proposal for a $10.10 wage, which is expected to come to a vote next month. Both parties are liable to use the issue in the coming fall election campaigns, so here's what they're saying.

  • "With unemployment Americans' top concern, our focus should be creating, not destroying, jobs for those who need them most," said Brendan Buck, a spokesman for House of Representatives Speaker John Boehner, R-Ohio, according to Reuters.
  • Sen. Tom Harkin, D-Iowa, took issue with the report's accounting of lost jobs. "More than 600 economists, including seven Nobel Prize laureates, recently affirmed the growing consensus that low-wage workers benefit from modest increases in the minimum wage without negative consequences for the low-wage job market," said Harkin, USA Today reports.
  • "The nonpartisan Congressional Budget Office confirmed yet again what we know to be true of government overreach in the marketplace: Raising the minimum wage would slash jobs and harm an already fragile workforce," said Sen. John Cornyn, R-Texas, according to Politico.
  •  "The CBO made it absolutely clear: Raising the minimum wage would lift almost 1 million Americans out of poverty, increase the pay of low-income workers by $31 billion and help build an economy that works for everyone," said House Minority Leader Nancy Pelosi, D-Calif., the New York Times notes.


AARP has supported increasing the minimum wage and making sure that pay levels are "sufficient to cover essential living expenses." About 13 percent of the workers who earn minimum wage or less are 50 or older.


Photo: Thomas EyeDesign/istockphoto

Search AARP Blogs