FACT SHEET: Debunking GOP Myths about the Minimum Wage
About 30-percent of Indiana’s workforce earns a minimum wage
INDIANAPOLIS – The Indiana Democratic Party, the organization that advocates for the future of Indiana and its families, today wanted to flag a glaring problem with Indiana’s press corps: the Indiana Republican Party’s decision to use debunked myths as a way to justify their opposition for increasing the national minimum wage. These disproven myths include the false notions that raising the minimum wage would harm small businesses, result in job losses, or would set a “minimum expectation” for low-income Hoosiers.
The Indiana Democratic Party expects all Republicans in Indiana’s congressional delegation to vote against an increase to the minimum wage. Their “nay” votes at the end of this week will be a snub to Hoosiers and will deny 892,000 workers a pathway to better opportunity.
“It’s simple: the Indiana Republican Party does not support low-income Hoosiers, and by voting against raising the minimum wage, they are telling Hoosiers the low-wage jobs they bring into the state is the best it’s going to get for their families,” said Lauren Ganapini, Executive Director for the Indiana Democratic Party. “Republicans’ opposition to the minimum wage is rooted in misinformation and rhetorical politics, not facts. Add this to a list of reasons why Hoosiers – especially the working class – should not trust the Indiana GOP.”
Enough of our yacking. Here is just a sampling of myths the Indiana Republican Party will use to justify denying working Hoosiers a pathway toward a better life:
MYTH: INGOP says job losses are imminent if there’s an increase to the minimum wage.
FACT: Economists have not found any direct correlation between increasing the minimum wage and job loss.
“But groundbreaking research in the 1990s suggested that the Econ 101 version was simplistic at best. Now there is growing confidence among economists — though far from a consensus — that lawmakers can mandate sharp increases in the minimum wage without killing large numbers of jobs.” – Associated Press
“…the higher a wage, the less likely it is that employees will quit. So a higher federal minimum could reduce high turnover at, say, fast-food outlets and make them more productive. Employers wouldn’t have to constantly scramble to find and train new employees — a task that consumes time, money and resources.” – Associated Press
“…the University of California at Berkeley’s Institute for Research on Labor and Employment (IRLE) released a  study that directly undercuts common conservative arguments against a higher minimum wage: Policies that raise minimum wages don’t appear to cause significant job loss. In fact, they reduce poverty.” – New York Magazine
“…Previous IRLE research found that six major U.S. cities — Oakland, Chicago, and San Francisco among them — didn’t experience significant job losses after they raised their minimum wages…” – New York Magazine
“Another important study gets at this question by looking at county-level data, comparing every contiguous county across state borders where minimum wages differed over the course of 16 years. Instead of ‘all sorts of problems,’ the researchers found ‘no evidence of job losses for high impact sectors such as restaurants and retail.’” – Washington Post
“Another recent study showed a similar result. In February 2018, the London School of Economics released research that examined minimum wage changes in the U.S. between 1979 and 2016. That study concluded that minimum wage increases did not significantly change the number of low-wage jobs.” – MarketWatch
MYTH: INGOP says small businesses will be hurt if minimum wage is increased
FACT: A majority of small businesses owners say increasing the minimum wage will have little impact on their business
About 63-percent of small business owners support President Joe Biden’s COVID-19 relief plan, which includes an increase to the minimum wage. – CNBC
“…In the latest CNBC|SurveyMonkey Small Business Survey for the first quarter 2020, small business owners across the country report sustained optimism at the start of 2020, and only a minority report a negative business impact resulting from the increased minimum wages.
In fact, in this quarter’s survey, 57% of all small business owners say these minimum wage increases will have no impact at all on their business in 2020, indicating that they can absorb the cost of the wage increase, sustain any loss in profits and find ways to raise revenue to compensate for the increase on their balance sheets.” […]
“The percentage of business owners who say they may be forced to cut workers or reduce hours are the same regardless of whether a small business owner is based in a state with or without a 2020 minimum wage increase.” – CNBC
“Ben Zipperer, an economist at the Economic Policy Institute (EPI), told Insider that there’s a “theoretical horror story” of businesses hiring less — and thereby hurting the lowest-paid workers — when the minimum wage is increased. He said that those effects are smaller or even nonexistent in the real world.” – Business Insider
FACT: Raising the minimum wage provides pathway out of poverty for Hoosiers
“Biden minimum wage proposal could lift more than 1 million workers out of poverty” – CBS News
“A 2019 Congressional Budget Office (CBO) report projected a significant improvement in the standard of living for at least 17 million people, assuming a minimum hourly wage of $15 by 2025, including an estimated 1.3 million people being elevated above the poverty line.” – Investopedia
“Two economists at the University of California Berkeley, Ellora Derenoncourt and Claire Montialoux, reported last year that the expansion of the minimum wage in the 1960s and 1970s ‘played a critical role’ in temporarily narrowing the income gap between white and Black workers. They concluded that ‘minimum wage policy can play a critical role in reducing racial economic disparities.’” – Associated Press