By the numbers: The impact of the $15 minimum wage
President-elect Joe Biden is calling to raise the federal minimum wage to $15 an hour, which is nearly double the current $7.25. The move would be the first change to the federal minimum wage since 2009.
Why it matters: The pandemic exposed the ugly ways in which America treats low-wage employees — even when they're doing essential jobs. Raising the federal minimum wage would put more money into the pockets of many of these same essential workers who have been on the front lines throughout the pandemic.
What to watch: $15 an hour would have a massive impact in smaller cities and in the middle of the country.
- Lots of larger metros, including San Francisco and New York, already have $15 or higher minimum hourly wages. In those places, the cost of living is so high that $15 feels more like $12 (see map above).
- But in smaller cities, where the minimum wage is much closer to $7.25 and the median wage is closer to $15, the federal bump would make a huge difference.
All told, "hiking the national minimum to $15 an hour by 2025 would lift 1.3 million workers above wages that put them below the poverty line," CBS reports, citing an analysis from the non-partisan Congressional Budget Office.
- Yes, but: The CBO also estimates that the hike could cost 1.3 million jobs, as small businesses unable to pay their workers $15 an hour lay people off or go out of business.
Go deeper: Government minimum wage hikes pay off for low-wage workers