An injection for the economy

Increasing the federal minimum wage to $10.10 an hour will benefit 16.5 million workers—a significant amount of people, whose greater purchasing power will help move the economy.

The calculation that the nonpartisan Congressional Budget Office made about the impact of raising the federal minimum wage also shows that raising this wage will lead some companies to lay people off. Estimates range from a “very small” drop to 1 million jobs. Therefore, the report adopted an average projection, 500,000 jobs.

It is precisely that possible loss of jobs that is being emphasized in the current political debate, since the report somewhat confirms conservative predictions that the wage increase will hurt those that it originally sought to help. Consequently, they say, it is not a real way to improve the quality of life of workers.

This is a selective, biased argument. It disregards that, according to the report, 16.5 million people will get bigger salaries and the increase will lift 900,000 workers above the poverty line.

If this is true, the benefits of the wage increase broadly surpass the problems that it could cause. What is not included in the calculations is that people, who need this extra money, will spend it quickly, creating more sustained demand that will drive job creation.

Ironically, people in conservative circles are only concerned about the job stability of poor workers when it involves paying them better wages. It is true that this increase will require part of the private sector to adapt, but for that, there is the progressive nature of its implementation.

Raising the minimum wage is one of the most direct tools to help people emerge from poverty. A workforce that does not have to depend on federal assistance because it is underpaid will be a powerful injection for the economy.