As the attached Congressional Budget Office report makes clear, increasing the minimum wage increases the cost of a minimum wage worker and induces a reduction in labor utilization. Essentially, an increase in the minimum wage is a tax on the employers of minimum wage workers. It could also be classified as an unfunded mandate.

Tax cuts are supposed to be paid for. The inverse should also be true. An increase in the minimum wage should be required to be accompanied by a corresponding decrease in some other operating cost, whether that be a reduction in a business tax, or the removal of a regulatory burden that carries a quantifiable cost. An increase in the minimum wage should be cost neutral.

The District will be raising the minimum wage to $11.50 per hour in the next couple of years. For many District employers, that is a serious burden. We’d like to hear from business owners and managers on some ways they’d like to see the mandated increase in labor costs offset. If you are a business owner or manager, fill out the short form below to tell us how you’re planning to handle the increase and give us your ideas on how these costs can be offset.

CBO Minimum Wage Report 2-14

 

Employer Survey on the Minimum Wage Increase

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