Push for US Minimum Wage Increase Receives Global Support

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The Organization for Economic Cooperation and Development recommended that the United States raise its minimum wage in its “Going for Growth” report released on Wednesday, giving the U.S. low marks for income equality.

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The OECD stated that the United States continues to contribute positively to its labor force through the use of apprenticeships, state grants, partnering with community colleges to promote vocational training and establishing young pre-apprenticeship programs. It added, though, that the U.S. should raise its minimum wage and strengthen its programs to help displaced workers find jobs.

President Joe Biden has proposed making the minimum wage $15, a change the OECD says is long overdue. The report shows that in the U.S., per capita gross domestic product is 16% higher than in other top performers, yet inequality is also higher than in most advanced economies.

The push for raising the minimum wage should also prioritize improvements to job placement and retraining services. The OECD also recommended paid parental leave and investments in child care to help increase labor participation rates.

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The international support for a minimum wage increase could help push along a decade-long fight to increase it. The federal minimum wage has been at $7.25 since 2009.

Push from the international economic association could help to put pressure on Republican legislators, who have long put small business priorities ahead of minimum wage changes. Small business owners say increasing the minimum wage now could impose a difficult burden during an already hard time, CNBC reports.

See: The GOP Wants a $10 Minimum Wage — How Does It Compare to $15 in the Real World?
Find: Would a $15 Minimum Wage Reduce ‘Deaths of Despair’?

Still, raising the minimum wage to $15 by 2025 would lift 3.7 million — including 1.3 million children — out of poverty, according to a report by the Economic Policy Institute.

“Despite claims that raising the minimum wage would reduce job opportunities for vulnerable groups of workers, the best evidence shows little to no job losses in the wake of minimum wage increases and a net wage gain even if job losses have occurred,” the EPI report said.

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About the Author

Georgina Tzanetos is a former financial advisor who studied post-industrial capitalist structures at New York University. She has eight years of experience with concentrations in asset management, portfolio management, private client banking, and investment research. Georgina has written for Investopedia and WallStreetMojo. 

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