Business Survey: Raising Minimum Wage Means Raising Prices

COM16AE_06-29-16_USA $15 Minimum Wage Would Lead 30% of Businesses to Eliminate Positions

Express Employment Professionals recently released new results from a survey of businesses revealing some of the effects an increase in the minimum wage would have on their company.

Respondents were asked, “What actions would you take if the minimum wage increased to $15 an hour?”

More than a third (37%) said they would increase the price of goods or services, and 30% said they would eliminate positions. On the other hand, 20% reported that they would increase other wages in their companies.

Of those surveyed, 18% pay the current minimum wage for some positions, while 82% do not.

“A $15 minimum wage has certainly become a political hot topic. There’s no doubt it makes for a good talking point, but the real question is whether it makes good economic sense,” said Bob Funk, CEO of Express, and a former chairman of the Federal Reserve Bank of Kansas City. “While some workers will see a raise, which is good news, this survey shows that there are clear negative consequences for raising the wage to $15.

“Policymakers should always keep in mind the unintended consequences of their actions. Our goal should always be getting people back to work-and creating a healthy, thriving economy that creates rising wages across the board.”

The survey of 390 businesses in the United States and Canada that are current and former clients of Express Employment Professionals was conducted in the first quarter of 2016.

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