February 10, 2021
Assessing CBO’s Report on the Raise the Wage Act
The Congressional Budget Office (CBO) released a report that analyzes the budgetary and employment effects of the Raise the Wage Act of 2021, which would raise the national minimum wage to $15 per hour. In a new analysis, AAF’s Director of Labor Market Policy Isabel Soto reviews and assesses the report’s key points.
The CBO report offers additional clarity on how a significantly higher minimum wage would impact workers, the economy, and the federal budget. While it finds that an increase in the minimum wage would clearly benefit low-wage workers that are able retain employment, it would also price others out of the market, driving up long-term unemployment. It also threatens to drive up prices on goods and services, as well as federal spending.