UPDATE: Minimum Wage Report Would Mean 45,000 Jobs Lost by 2022 (VIDEO)

A report prepared for Montgomery County government said an increase of the minimum wage to $15 an hour would mean that by 2022, more than 45,000 jobs would be lost, more than $396.5 million in income would be lost and nearly $41 million in lost tax revenue.

The report also noted the positive effects of raising the minimum wage, which has been a goal of local and national labor groups. For example, the report says increasing the minimum wage improve mental health, reduce hunger and decrease stress for workers and their families.

The report, released Tuesday night, was prepared by PFM Group Consulting of Philadelphia.

The minimum wage rose to $11.50 an hour on July 1.

Montgomery County Council President Roger Berliner said Wednesday that the report would be the subject of a council meeting Sept. 19.

In January, the council voted 5-4 to take the minimum wage to the $15 level, but County Executive Ike Leggett vetoed the legislation.

Much of the report is based on answers provided by focus groups. For example, focus groups of nonprofits said the agencies would need seek funding increases, including the county and private funders, and look to new funding sources.

“The business owners interviewed were often supportive of raising the minimum wage and providing a true living wage for their employees. However, there were doubts that their organization could withstand the increase and remain profitable,” the report says.

On Wednesday, Leggett called it a “sobering report.” He said his office paid for the report, which cost between $65,000 to $70,000. In this MyMCMedia Extra, Leggett discusses the report:

Berliner said the study shows a $15 an hour minimum wage will hurt more than help low-wage workers.

“I think some of us have always said there are two competing truths here. It is true increasing wages reduces stress and help people take care of their families,” he said. “What this study also says it comes at a cost, and it comes at a cost to all the people we are trying the most trying to help. How you reconcile those competing truths is the challenge we face.”

Councilmember George Leventhal supports the $15-an-hour minimum wage.

He said consultants can be hired to make any pronouncement on a minimum wage increase. “Economists are not in agreement,” he said. Stopping all minimum wage increases at $11.50 an hour in 2017 is not realistic, he said.

The question becomes what schedule of future increases can garner a veto-proof majority on the council, Leventhal said.

“I’m not wedded to the numbers in the most recent bill,” he said.

The committee he chairs, Health and Human Services, also will discuss the study, although it will likely be after the full council it takes up, he said.

The report does not reach a recommendation for the county. Instead it envisions more debate:

“Ultimately, the decision on how to proceed will require the weighing of multiple issues and impacts. It is likely that multiple stakeholders and policymakers will find support for their respective (even if dissimilar) positions from the findings and analysis within this study. This is, after all, a topic that has generated — and will continue to be the subject of — considerable debate. The project team believes that the economic, financial and socioeconomic analysis from this study will advance the discussion of key public policy issues in Montgomery County and beyond.”

Here’s the report:

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Douglas Tallman

About Douglas Tallman

Reporter with 35 years experience throughout Maryland. Reach me at dtallman@mymcmedia.org or via Twitter at @MCM-Doug


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