In Tuesday’s State of the Union, President Joe Biden doubled down on his support of several left-wing labor priorities that would empower union bosses at the expense of workers. If Biden is successful at imposing his agenda, American workers and small businesses already battling runaway inflation will pay the price.
Biden called for raising the minimum wage to $15 an hour, a disastrous move that would risk killing millions of jobs and thousands of small businesses attempting to dig out from the COVID-19 pandemic. While Democrats attempt to spin a $15 minimum wage as pro-worker, the data tells a different story.
According to the most recent analysis from the nonpartisan Congressional Budget Office, a $15 minimum wage would eliminate approximately 1 million jobs by 2023 and up to 3.3 million jobs by 2029. Another CBO estimate shows that a $15 minimum wage could kill up to 3.7 million American jobs.
A $15 minimum wage would especially harm Americans entering the workforce for the first time. A literature review from the National Bureau of Economic Research found that the weight of scientific evidence shows that a $15 minimum wage harms low-skilled employment. Another study showed that a $15 minimum wage would disproportionately affect women.
For people looking to start their careers, a first job is the first rung on the ladder to success. If workers lose that crucial shot because of a federally mandated $15 minimum wage, the loss of opportunities and earning potential will follow them the rest of their careers.
Biden also called on Congress to pass for the “Protecting the Right to Organize” (PRO) Act, the Democratic party’s lifeline to organized labor. The PRO Act would rewrite American labor law for union chiefs and force Americans into W-2 employment.
The bill nullifies right-to-work laws nationwide, which protect approximately 166 million Americans in 27 states, more than half the population. In right-to-work states, employers cannot force employees to join a union as a condition of employment. Nullifying right-to-work laws nationwide means that every worker will have to choose between putting food on the table or paying a union boss.
The PRO Act would also make it more difficult for Americans to work as independent contractors by instituting an onerous three-step test unprecedented in federal law. Over 59 million Americans engage in some sort of freelance work, and fewer than 1 in 10 independent contractors would prefer to reclassify as W-2 employees.
Independent contracting gives workers the opportunity to earn a living without having to report to a boss. As government-mandated lockdowns killed jobs and shut businesses down, Americans turned to the gig economy to pay the bills. The PRO Act’s stringent restrictions on independent contracting will choke off these crucial work opportunities for millions of Americans.
The PRO Act also has serious implications for worker privacy. During unionization campaigns, the PRO Act would force employers to hand over sensitive employee contact information to union bosses including an employee’s shift hours, home address, phone number and personal email address. This would open up workers who do not wish to join a union to 24/7 intimidation from union organizers.
The PRO Act is live ammunition, having passed the House in March 2021 and currently awaiting Senate consideration. The PRO Act is so important to union bosses that they have threatened to withdraw all campaign cash from Democratic lawmakers that do not vote for the bill.
Instead of focusing on policies that would help Americans deal with runaway inflation, Biden doubled down on Big Labor’s wishlist. No matter what organized labor is selling, implementing a $15 minimum wage alongside the PRO Act would be a doomsday scenario for American workers.
Tom Hebert is federal affairs manager at Americans for Tax Reform and executive director of the Open Competition Center.