New Survey: Does Minimum Wage Hike Help or Hurt?

WEB15CTA_300x250_AmericaEmployedOver 1/3 of Businesses Would Reduce Hiring If Wage Raised To $10.10. More Favorable View of Wage Hike Than in 2014

Express Employment Professionals recently released a new study on raising the minimum wage and its effect on businesses, employees and the unemployed.

In March of 2015, Express Employment Professionals surveyed 837 business owners, HR professionals, and employees about the positive and negative impacts of a minimum wage increase.

Of those surveyed, 59% said a minimum wage increase would be bad for U.S. businesses, down from 63% in 2014, while 66% believe it would be good for U.S. workers, up from 58% in 2014

Similarly, 70% said raising the minimum wage would have a negative impact on employers. While 70% also said it would have a positive impact on employees, 60% said it would negatively impact the unemployed. Additionally, 65% said it would negatively impact the long-term unemployed.

In general, a minimum wage hike was seen as hurting businesses and the unemployed, while helping workers who currently have jobs. Overall, views on raising the minimum wage are less negative than in the 2014 survey.

Business owners and decision makers were also asked if raising the minimum wage to $10.10 would cause them to reduce future hiring or let employees go. Over one-third, 36%, said it would cause them to reduce hiring, and 17% said it would cause them to lay off employees.

“A minimum wage increase cuts both ways, as this survey reveals,” said Bob Funk, CEO of Express, and a former chairman of the Federal Reserve Bank of Kansas City. “On the one hand, it could raise wages for some workers, but on the other hand it can mean layoffs. Because it also reduces the ability to hire, raising the minimum wage could mean zero wages for some.

“As I’ve said before, these are the considerations that must be properly weighed by policymakers before increasing the statutory minimum wage. Interestingly, we have seen some large companies raise their own minimum wages recently, indicating that they have calculated it’s good business in their particular circumstances.”

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Refresh Leadership is brought to you by Express Employment Professionals.

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