Protestors rally against subminimum wages. (Photo by Noam Galai/Getty Images for One Fair Wage)
On proposals to raise Ohio’s minimum wage to $15 an hour, most economists agree that it would benefit low-income Ohioans, and most say the increase would not lead to a significant increase in unemployment, according to a recent survey.
A group proposing to increase the minimum wage from the current $10.45 an hour to $12.45 and then to $15 held back this year from trying to get the measure on the November ballot. But it is looking to put the proposal to voters in 2025.
If it’s successful, it would “significantly improve the welfare of low-income people in Ohio,” said 11 economists surveyed on the matter by Scioto Analysis. Five others disagreed with that assertion, and three said they were uncertain.
How would it hurt low-income workers to boost the minimum wage by 50%?
“In the short run there may be some improvement, but over time low-skilled workers face the danger of being replaced by technology,” Joe Nowakowsky of Muskingum University said in the comments section of the survey.
But Faria Huq of Lake Erie College said the net effect would be positive.
“Some groups might be hurt due to unemployment, but those that are employed are likely to see an improvement in well being,” she said. “Increased productivity would also benefit employers.”
The economists were more evenly divided on whether raising the minimum wage to $15 an hour would lead employers to eliminate some of those jobs.
Ten disagreed that it would significantly increase unemployment, three agreed that it would, and six were uncertain.
Will Georgic of Ohio Wesleyan University strongly disagreed that raising the minimum wage would add to joblessness, and he cited specific research to support his position.
“In his 2019 report for the United Kingdom, labor economist Arin Dube found that the minimum wage can reach somewhere between 60% and 66.6% of the median hourly wage for a territory without causing significant negative effects on employment,” Georgic wrote. “Coincidentally, the median hourly wage in the state of Ohio in 2023 was $22.45, as reported by the Ohio Department of Job and Family Services. A $15 minimum wage would be 66.8% of this median wage, which has risen over the past year.”
Many of the other economists said that history shows that the impact of an increase will be minor.
“There is lots of evidence now from prior minimum wage increases that the impact on employment is small,” said Kevin Egan of the University of Toledo.
But Curtis Reynolds of Kent State University said the size of the increase would cost some their jobs.
“This would be almost 50% higher than the current minimum wage of $10.45,” he said. “While I would love to see people being paid a higher wage, this almost certainly would cause unemployment, at least in the long run.”
Meanwhile, a study released this summer by Scioto Analysis said that increasing the minimum wage to $15 an hour would have beneficial consequences. It would save 4,000 lives and create a $25 billion benefit to the state economy by 2036, the study said.
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