The Joint Committee on Labor and Workforce Development considered legislation this week to raise the state minimum wage to $20 per hour. If the bill advances, it will make Massachusetts one of the highest minimum wages in the nation. Massachusetts currently has a $15 per hour minimum which has been in effect since 2023 and was a result of the 2018 Grand Bargain that raised the wage over a 5-year period.

In May of 2023, NFIB released an economic study (Economic Impacts of a Proposed Minimum Wage Increase in Massachusetts) conducted by Amherst-based Regional Economic Models, Inc. (REMI) to determine the economic impact of legislation seeking to raise the minimum wage to $20 per hour. The study found that if these bills became law, over the next decade approximately 23,000 jobs would be lost, representing more than 0.5% of the state’s employment base. Almost 14,000, or 57%, of job losses would be suffered by small businesses with nearly 22.5% coming at the expense of firms with less than 20 employees. The real economic output loss, resulting from the proposed minimum wage hike over that decade, would exceed $3.4 billion. Nearly $1.8 billion, or 52%, of that lost economic output would have been produced by small businesses.

Many small businesses will be unable to afford these higher wages and the payroll taxes that accompany them, and there will also be immense pressure on labor costs up the pay scale. Whether you have minimum wage positions at your business or not, we ask that you take a moment and send a message to your lawmakers.

Additionally, the committee heard bills allowing striking workers to collect unemployment insurance. Not only will this further strain an already broken UI system, it would place employers at a disadvantage during negotiations with labor during contract disputes.

NFIB provided testimony in opposition to all of these bills.