Increasing the minimum wage to $15 per hour could cost Wisconsin at least 350,000 jobs, according to a new report published by the conservative think tank, the Badger Institute.
According to the analysis, “a high proportion of the state’s workers—fully 38 percent—earn less than $15 an hour. Our modeling suggests that almost one-third of this group would be at risk of losing their jobs were Wisconsin to quickly increase the minimum wage – which amounts to 350,000 workers.”
Increasing the minimum wage to $15 an hour is “tantamount to an hourly pay increase of 107 percent for workers currently earning the minimum wage,” which is unsustainable for employers, the analysis argues.
Half of all job losses would come from the bottom ten percent of the income distribution, and 90 percent would come from the bottom quartile of the income distribution, the report states. The authors estimate that 50 percent of all affected workers in food preparation and service would lose their jobs.
Other major job losses would occur in building and grounds cleaning and maintenance, personal care and service, sales, office and administrative support, production occupations and transportation and material-moving industries.
Supporters of a minimum wage hike say it would lift the salaries of hundreds of thousands of Wisconsin workers
“This move would give a raise to 464,000 workers in Wisconsin, or about one out of every six workers,” the Budget Project’s Tamarine Cornelius said.
The Badger Institute’s analysis calculated wage distribution statewide, both aggregated and across industries, from data obtained from the federal Bureau of Labor Statistics Occupational Employment Statistics output. The data set includes wage detail distribution at the state level at the 10th, 25th, median, 75th and 90th percentile.
The estimates account for a one-time increase with quick implementation similar to minimum wage increases implemented in New York or Seattle, and acknowledges that a slower implementation or phase-in would result in smaller job loss estimates.