One of the major components in President Biden’s $1.9 trillion economic stimulus package was raising the minimum wage from $7.25 per hour to $15 per hour by 2025. CNBC reports that Democratic senators will drop the minimum wage issue from the bill so that the stimulus can be passed as soon as this week.
The House of Representatives passed the stimulus with the $15 minimum wage provision. The Senate has a thinner Democratic majority — one vote, and only if Vice President Kamala Harris’s tiebreaker comes into play. Last week, the Senate parliamentarian ruled that including the $15 minimum wage requirement in the bill would require the bill to be voted on by the entire Senate rather than go through the reconciliation process. The bill didn’t have enough votes to pass with the $15 minimum wage included. Without it, the bill could well pass without going through reconciliation.
If the bill passes with different language than the House bill, it will go to conference committee. The final language will then be negotiated before becoming law.
The $15 minimum wage proposal has a lot of support but also a lot of opponents. Congressional Budget Office estimates show that it would decrease poverty levels in the U.S., but it would also increase unemployment. The issue is likely to be revisited after the stimulus passes. Already, senators have been proposing alternatives, including a smaller increase in the minimum wage and tax penalties for certain low-wage employers.
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