Raising the minimum wage to $10.10 an hour by 2016 would increases wages by $35 billion, and the resulting increase in consumer spending would mean $22.1 billion boost to the GDP, which would support about 85,000 new jobs, according to an analysis by the Economic Policy Institute. Because low-wage workers are much more likely to spend extra earnings, raising their wages can boost economic activity when consumer spending is low. The report finds that 27.8 million workers would get a raise with a higher wage. Other studies have found that raising the minimum wage would be good for growth, such as one from the Chicago Fed that found raising the minimum wage to $9 an hour would increase consumer spending by $28 billion, even with the possibility of job losses taken into consideration, increasing GDP by 0.2%.
Source: Think Progress, 12/19/13, Minimum Wage
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