A brief from my team at Gingrich 360:
President Joe Biden has committed $15 billion in aid to small businesses and restaurants struggling to make ends meet during the pandemic. However, with the aid comes a new minimum wage mandate that will take away any benefits the $15 billion in aid offers.
Currently, restaurants employ 2.5 million fewer people than they did before COVID-19 struck. Because of the severe job losses in the restaurant business, Biden has acknowledged the need to revive these small businesses. However, Biden believes that part of helping these businesses requires more than doubling the minimum wage to $15 an hour, up from $7.25 an hour. This ultimately means that restaurants will not be able to employ as many people because they will not be able to afford the increased cost of paying each employee. These long-term costs are not offset by the COVID-19 relief package at all.
Economists at Miami and Trinity universities have found that raising the minimum wage to $15 an hour “would cost the hospitality industry more than one million jobs—including nearly 700,000 held by tipped workers.”
“Saving” restaurants from the pandemic does them no good if they go out of business a few months later because of an increased minimum wage. Read more about the minimum wage debate here. [vc_separator][vc_column_text]Newt will host a virtual live event at 11 a.m. ET on Jan. 26.
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