This year, members of Congress have introduced a bill to raise the federal minimum wage
requirement up to $25 per hour by 2031 for larger businesses. Smaller businesses will reach
that rate in 2038. The bill would also eliminate the federal tip credit, raising the cash wage for
tipped employees up to $25 per hour. New estimates show this would slash millions of jobs
across the country.
The majority of research over three decades finds minimum wage increases reduce employment.
A new model developed by the Employment Policies Institute (EPI)–based on methods developed
by the nonpartisan Congressional Budget Office (CBO) and other American labor economists–
compiles the latest economic data to estimate what this means for workers under the latest proposed minimum wage hike. Using these established methods and the latest Census Bureau
data on workers across the country, EPI estimates the federal $25 proposal will cost 5.01 million
jobs nationally, significantly impacting the hospitality sector, tipped restaurant workers, and teens.
Key Findings:
- The bill proposes a 245% increase in the federal minimum wage.
- More than 5 million jobs would be lost.
- 52% of job losses are among 16-24 year olds.
- One-third of job losses are in the restaurant industry.
See the full report and methodology here.
