Major business organizations have raised their voices to criticize the Democrat-controlled House right after it passed a bill to raise the federal minimum wage from current level of $7.25 to $15 per hour by 2025.
The bill, known as the H.R.582 – Raise the Wage Act, was passed on Thursday, July 18, with a vote of 231-199, with six Democrats opposing and three Republicans supporting it.
The new minimum wage is considered very high compared to current levels. The highest minimum wage being paid in the District of Columbia at $13.25 per hour, while numerous other states are only $7.25 per hour. The minimum wage in California is currently $11, while several southern states have no minimum wage.
CNBC citing business groups said the bill would be expensive and lead to increased unemployment.
The National Restaurant Association complained about the bill, saying thousands of restaurant industry employees, leaders, and community members have called and emailed Congress to share their concerns about how H.R. 582 would cripple small- and family-owned businesses.
“H.R. 582 is the wrong wage at the wrong time, implemented in the wrong way,” the association’s spokesman Sean Kennedy said in a statement.
Kennedy said Congress should have a commonsense approach to minimum wage.
A representative for the National Retail Federation (NRF) also expressed its discontent over the bill.
“This unprecedented proposal to increase the minimum wage by 107% is a one-size-fits all approach that would lead to unintended consequences for American workers and the businesses that employ them,” said David French, senior vice president of government relations at the NRF.
National Federation of Independent Businesses (NFIB)—the leading advocacy organization for small businesses—slammed the House’s decision.
“The House dealt a devastating blow to small businesses today, risking record growth, job creation, and already increasing wages,” said Juanita Dugganin, president and CEO of the NFIB.
The National Association of Manufacturers also cried over the minimum wage bill.
In a letter to the House before the vote, the association’s Vice President Patrick Hedren wrote, “H.R. 582 creates new economic headwinds for manufacturers—ignoring the sector’s investments in skills training, competitive compensation, and generous benefits—all at the expense of millions of American workers.”
The Raise the Wage Act still requires passage in the Republican-controlled Senate where Senate Majority Leader Mitch McConnell (R-Ky.) is unlikely to bring up the legislation in his chamber.
Dugganin encouraged the Senate to kill the bill.
The White House pledged that President Donald Trump would veto it if it made it to his desk.
The nonpartisan Congressional Budget Office released its report last week, titled the “Effects on Employment and Family Income of Increasing the Federal Minimum Wage,” which estimates that the Raise the Wage Act would result in a median estimate of 1.3 million lost jobs and $9 billion in total income lost in 2025.