Last week’s disappointing jobs report revealed the economic pain felt by millions of Americans, but NBC’s senior business correspondent ...
Last week’s disappointing jobs report revealed the economic pain felt by millions of Americans, but NBC’s senior business correspondent said on Friday that rising joblessness may be just the “pressure we need” to raise the minimum wage to $15 an hour.
The Biden administration announced that the U.S. economy added only 266,000 new jobs in April, when unemployment actually rose from 6% to 6.1%. Experts had expected 1 million new jobs and a modest decline in unemployment. CNBC’s Steve Liesman initially thought the numbers — which other media outlets described as “a huge letdown” and “way worse than expected” — were erroneous.
“It’s not that there aren’t jobs; it’s that people aren’t filling them,” Ruhle said on MSNBC’s “Craig Melvin Reports,” which follows her own show.
Many economists believe the glut of job vacancies exists because Congress voted to pay an extra $300 a week in unemployment benefits during the COVID-19 pandemic, a decision that for many Americans made government support more profitable than income from a job.
“The disappointing jobs report makes it clear that paying people not to work is dampening what should be a stronger jobs market,” said Neil Bradley, executive vice president of the U.S. Chamber of Commerce. “Based on the Chamber’s analysis, the $300 benefit results in approximately one in four recipients taking home more in unemployment than they earned working.”
But Ruhle dismissed those concerns, speculating that “the government chose that amount of money because, most likely, it’s what people need to get by.”
“We are seeing some business advocacy groups urging, saying, ‘See, it’s that expanded unemployment. People are getting paid so much, they’re staying home,’” she said.
“But the other side of that coin, Craig, is that this could be the wage pressure that we need to finally raise just for low wage workers. Remember, Democrats wanted to raise the federal minimum wage. They didn’t get that through,” she continued.
House Democrats initially included a provision to raise the minimum wage to $15 an hour in President Joe Biden’s COVID-19 relief bill, but it was later stripped out.
“Now you’re seeing wage pressure. All sorts of businesses are forced to pay more to get people back,” Ruhle said. “All of this may expose how we need to change how we compensate people. … And so now they need to solve for all this.”
Ruhle, in essence, called for something like a Cloward-Piven Strategy for the minimum wage hikes: Unemployment rates will continue to climb until Congress passes legislation to “solve” the problem it created.
Of course, raising the minimum wage will destroy jobs and opportunity, not create them. In February, the Congressional Budget Office said raising the minimum wage to $15 an hour would cost the U.S. economy 1.4 million jobs. That’s a significantly lower estimate than the CBO offered in 2019, when it said passing the same legislation would cause the economy to shed as many as 3.7 million American jobs.
One of President Barack Obama’s top economic advisers, Harvard economic professor Jason Furman, schooled Ruhle on the matter on her own show on Thursday, May 6:
Ruhle: I want to go back to worker pay, for businesses that say they can’t find employees, and they can’t afford to pay people more. If you can’t afford to pay people a living wage, isn’t there an argument to be made those businesses should go out of business?
Furman: I don’t think so. You know, the worst thing is a business to pay somebody zero dollars. Any business in the country is allowed to pay zero dollars and allowed to not hire people. If a business is offering job opportunities to workers – many of whom have, you know, lower levels of skill, [and] no one else wants to employ them — I think that’s a great thing, and we want those businesses.
Still, Ruhle doubled down on Friday. “Rather than end the $300 expanded UI kicker, why not RAISE THE MINIMUM WAGE. People shouldn’t make more on unemployment than from work…so PAY THEM MORE TO WORK,” she tweeted. “If businesses can’t afford to pay a living wage, maybe their business model is failing.”
President Joe Biden agreed, saying in a speech on Friday that the April job numbers “show we’re on the right track.”
The enhanced unemployment benefits had no “measurable” impact on increasing unemployment, he said.
He added that the higher-than-expected unemployment numbers on his watch prove the need for his free-spending economic agenda to “build back better.”
A higher minimum wage will be part of that conversation, as it enjoys substantial support within the administration. As a presidential candidate, Transportation Secretary Pete Buttigieg said anyone who opposes raising the minimum wage “taunts” God.
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