Fast-food workers and their supporters are calling for a $15-an-hour minimum wage as they prepare to picket in nationwide protests. The current federal minimum wage is $7.25 an hour. More than doubling that level would be an unprecedented leap. One might ask, what will the economic repercussions of such an increase be? And although the answer is not crystal clear, economists have a some idea.Doubling the minimum wage could consume as much as three-quarters of fast-food corporate profit, but it is unlikely that this would be tolerable to the fast-food industry. Thus, if a comprehensive 2006 study is used as the basis for extrapolation, a $15 minimum wage would cause as much as a 17% surge in fast-food prices and a nearly 27% slide in employment.
In other words, on average an $8.00 Value Meal will immediately cost $9.33, and only 73% of fast-food workers will keep their jobs. The remaining 27% will join the ranks of the unemployed.
