[Congressional Record (Bound Edition), Volume 152 (2006), Part 2]
[Extensions of Remarks]
[Page 1769]
[From the U.S. Government Publishing Office, www.gpo.gov]




               RAISING THE MINIMUM WAGE IS GOOD ECONOMICS

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                           HON. BARNEY FRANK

                            of massachusetts

                    in the house of representatives

                       Tuesday, February 14, 2006

  Mr. FRANK of Massachusetts. Mr. Speaker, a study completed last month 
by Alicia Sasser, of the Federal Reserve Bank of Boston's New England 
Public Policy Center, contains good news for those of us who have been 
pushing for an increase in the minimum wage. Ms. Sasser's very careful 
and well-documented conclusion is that an increase in the minimum wage 
in the State of Massachusetts would have significant overall benefits 
for the people of the State. To summarize her conclusion, ``increasing 
the minimum wage by $1.50 in Massachusetts is likely to have a small 
impact on employment--roughly on the order of 1 to 4 percent of 
affected workers. In addition, according to the analysis presented in 
this report, the combined impact of the two wage increases 
(contemplated and pending legislation in Massachusetts) would result in 
an estimated net wage gain of approximately $255 million. It should be 
noted, however, that the benefits of this increased wage gain may be 
diminished if employers respond by cutting hours or reducing their 
contributions to health insurance.''
  It should be noted, Mr. Speaker, that this is an analysis of what 
will happen in one State if that State alone raises the minimum wage. 
One of the potential negative effects is the loss of jobs for 
competitive reasons to the nearby State of New Hampshire, which does 
not have a minimum wage. What this means is that if we were to adopt a 
minimum wage increase on the national level, we would get, I believe, 
the advantages that Ms. Sasser's analysis, shows without that 
particular competitive disadvantage that comes from two States of 
virtually identical social composition right next to each other, having 
significant minimum wage differentials. While obviously there is 
international economic competition, it is not nearly as direct, 
especially in the industries that are affected by minimum wage 
increase.
  Mr. Speaker, I recommend that Members read this report. It is too 
long for inclusion here in the Record, but it is New England Public 
Policy Center Research Report Series, No. 06-1, issued in January. This 
analysis in my view--I do not impute it to either the Federal Reserve 
or Ms. Sasser--strongly argues in favor of Federal legislation to raise 
the minimum wage.

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