A new study conducted by a pair of economists reveals that workers across the state will suffer if Ballot Amendment 2 passes this year.
The analysis for the report, “Estimating the Impact of a $15.00 Minimum Wage in Florida,” was prepared by economists William Even and David Macpherson. The study concludes that the $15 minimum wage proposal on the ballot this November will kill at least 158,000 jobs in Florida, adding to the hundreds of thousands of jobs already lost due to the coronavirus pandemic.
“By 2026, the economists estimate that 158,000 jobs will be lost because of a $15 minimum wage,” reads the economic analysis. “Should the hospitality industry face slower growth than other industries, this figure would rise to 181,000 lost jobs.”
Currently, Florida’s unemployment rate stands at 11.3 percent due to the economic impacts of COVID-19. According to economic analysis, COVID-19 has already destroyed about 336,000 direct and hotel-supported jobs and led to hundreds of thousands of job losses and billions in sales.
Restaurants in the Sunshine State have also taken a hit due to the worldwide contagion, with over 598,000 jobs being lost in the sector, according to a report from the National Restaurant Association.
“If a $15 minimum wage has broader negative impacts on the state’s economy, the resulting slower economic growth would create long-term impacts from which the state might never recover,” the study continues.
Before COVID-19, Florida’s restaurant, lodging and tourism industry generated more than $112 billion in annual economic impact and provided jobs for more than 1.5 million Florida families.
If Florida passes Ballot Amendment 2, the report, based on data from the nonpartisan Congressional Budget Office (CBO), shows that the hardest-hit workers include tipped workers, women and teenagers, although all age groups, including seniors over the age of 65, will also be negatively impacted.
“Amendment 2 would raise the tipped minimum wage by more than 100% — substantially raising the required base pay for employees who already earn far more than minimum wage through their tip income…Florida would lose 25,900 tipped jobs were Amendment 2 to pass. Research shows that a higher tipped minimum causes firms to opt for service models that require fewer employees. Also, tipped workers who are able to keep their jobs may experience declines in income, based on new research from Cornell University showing that employees receive fewer tips as the tipped wage rises.”
“Younger workers age 16-19 – who currently face double-digit unemployment rates – would shoulder the largest proportion of job loss. Even older workers age 65+, who may be working part-time to earn supplementary income, face a substantial risk of job loss. Also at greater risk are female workers,” the report continues. Female workers would lose two-thirds of the estimated total jobs lost.
Spearheaded by TV trial lawyer John Morgan, the Constitutional amendment would gradually increase Florida’s minimum wage to $15 an hour. But several pro-business groups, including the Florida Restaurant and Lodging Association (FRLA), have geared up to fight back against the initiative.
Carol Dover, who serves as President and CEO of FRLA, is one of the many business leaders on the frontline of the fight to protect Florida jobs. Facing the Sisyphean task of rebuilding the state’s hospitality industry, Dover has put her nose to the grindstone, utilizing every resource — both in-state and out — to restart the state’s economic engine.
In May, she appeared alongside Vice President Mike Pence and Governor Ron DeSantis, participating in a roundtable conversation to discuss the economic impact the virus has had on the industry, and to call on state leaders to fight back against the minimum wage hike.
Despite making strides in helping restaurants and hotels weather the storm, Dover maintains that Morgan’s $15 wage increase would be the coup de grâce for many in the hospitality industry.
“Ballot Amendment 2 is a job killer that will hurt the very people it pretends to help. Florida’s hospitality industry is on life support right now. More than 934,000 of the 1.5 million workers across the industry have been furloughed or laid off, and thousands of businesses have closed,” Dover said following today’s study.
“Recent economic studies prove the devastation that will come if Ballot Amendment 2 passes, and we have seen this experiment fail in other cities like Seattle, Chicago, and Washington, D.C. Florida businesses will be forced to cut jobs, eliminate benefits, move to automation, and raise prices. Why would we bring even more devastation to Florida as we try to recover from the COVID-19 pandemic?”
The proposed amendment will be considered on the Nov. 3 ballot and will require 60 percent approval from voters to pass.
To view the complete analysis, click HERE.