Rep. Byron Donalds, R-Fla., Responding to the Biden government’s $ 1.9 coronavirus stimulus push.
The $ 15 minimum wage increase proposed by the Democrats will lead to higher childcare costs for many families as childcare workers pass the cost of higher wages on to parents, according to an analysis by Rachel Greszler, an economist at the conservative Heritage Foundation .
Setting a minimum wage of $ 15 would increase childcare costs in the U.S. by an average of 21%, which, according to Greszler’s analysis, equates to $ 3,728 a year for a family with two children. Families in low-cost states like Louisiana, Oklahoma, and Missisippi would see the biggest increase, Greszler wrote.
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“With childcare consuming even more family budgets – 40 percent or more of the median household income in many states – many families could be completely excluded from the childcare market,” Greszler wrote in an article published Thursday. “The unintended consequences of a minimum wage of $ 15 could force some parents to quit their jobs and live on lower household incomes, while others – particularly single parents – turn to unlicensed, usually illegal, childcare.”
The analysis is based on months of data that show that mothers are being pushed out of the workforce because they are faced with scarce or expensive childcare options.
Greszler pointed out that the average wage for childcare workers in the U.S. is $ 11.65 per hour and the childcare industry cannot cut costs by automating tasks or reducing their workforce, as can the retail or restaurant industries.
“Using wage distribution data from the Bureau of Labor Statistics employment statistics, I estimate that a minimum wage of $ 15 would require an average 29 percent increase in childcare wages in the 50 states,” Greszler wrote. “This does not include additional Federal Insurance Contribution Act (FICA) taxes and other potential costs that employers would have to pay along with higher wages.”
Greszler suggested alternative solutions to help families, including reducing regulations on childcare providers and providing public childcare allowances to parents.
Democrats on the House Committee on Education and Labor on Wednesday approved a proposal for a $ 15 minimum wage included in President Biden’s coronavirus bailout package. However, you might run into an obstacle in the form of the Byrd’s Rule, which states that anything that was passed during the budget vote must be related to the federal budget in some way.
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Senate Majority Leader Chuck Schumer, DN.Y., said he and Senator Bernie Sanders, I-Vt., A longtime advocate of the federal minimum wage increase, are doing “everything we can” to ensure the proposal goes through is not removed during the voting process.
“Well, Sen. Sanders and I are working very closely together to overcome the Byrd Bad and make sure we do everything we can to see it survive the Byrd Bad. We’ll see what happens. That’s this first step, “said Schumer during a press conference on Thursday.
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Fox News’ Tyler Olson contributed to this report.
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