A study released by Philadelphia-based economic consulting group PFM on Aug. 1, suggested that a $15 minimum wage hike would cost one of the richest counties in the U.S. 47,000 minimum wage jobs. (Getty Images)
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A new study suggested that if the minimum wage is raised to $15 in one of the richest counties in the United States, the resulting job loss would number in the tens of thousands.
Maryland's Montgomery County, bordering Washington, D.C., is the 11th-richest county in the United States, according to the 2012 American Community Survey, with the medium income being $95,965.
A bill by Montgomery County Council member Marc Elrich, a Democrat, would raise the current minimum wage from $11.50 to $15 an hour, the Washington Post reported. According to a study released by Philadelphia-based economic consulting group PFM on Aug. 1, not even the county's wealth can save the 47,000 minimum wage jobs that would be lost.
According to the Post, PFM's study revealed that should the minimum wage be raised to $15, the loss of income would place in the hundreds of millions:
PFM found that increasing the minimum wage to $15 would result in an aggregate loss of $396.5 million of income in the county by 2022 as businesses laid off employees, cut remaining employee hours and benefits, and suspended plans to invest in new locations and hire additional workers.
Democratic County Executive Isiah Leggett ordered the study done in January after vetoing a minimum wage hike bill from Elrich that passed the city council 5-4.
“We can’t minimize some of the impacts outlined here,” Leggett said. “Even if it’s not 47,000 jobs lost, even if it’s half that, those are some startling numbers. You can’t discount it all.”
Elrich's updated minimum wage bill, which was submitted in late July, would require businesses to comply with the minimum wage hike to $15 by 2020. Nonprofit organizations, adult day-care providers, and companies with fewer than 26 employees would have until 2022 to fall in line.
According to the Post, the business community and wage hike opponents criticized Elrich's bill for being submitted before the results of the study had been released. The Montgomery County Business Coalition called the bill's introduction "irresponsible" and demanded that the bill be removed from consideration until the PFM's study was released.
However, wage hike proponents questioned the PFM study's validity, as it simply asked business owners to predict their business's economic future. Elrich called the study “nonsense" and claimed that the business owners would certainly cause the study to show a negative impact caused by a raised minimum wage.
“I know they will project that this will cost jobs,” Elrich said.
This is not the first study highlighting the impact of raising the minimum wage. In June, a study by the University of Washington found that Seattle's wage hike to $13 an hour cost minimum wage employees $125 a month in lost hours. The study also said that had Seattle never raised their wage, there would be 5,000 additional jobs available, totaling to a lost 3.5 million hours of work according to statistics site FiveThirtyEight.
The University of Washington study was later cited when Missouri passed a bill preventing Missouri cities from having a municipal wage higher than $7.70 an hour.
(H/T: Daily Wire)
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