Craftsmen repair glass on the East Front rotunda doors that was damaged during the January 6 attack on the US Capitol on February 08, 2021 in Washington, DC.
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LONDON — The U.S. should go ahead with a plan to increase its federal minimum wage to help with a more umbrella recovery from the coronavirus crisis, the Organization for Economic Cooperation and Development said Wednesday.
President Joe Biden afters to increase the minimum pay of federal employees to $15 per hour, and an executive order for doing so could come in a matter of weeks. Coinciding to the OECD, this is critical to support low-income earners, who have been more severely impacted by the pandemic.
“In a handful advanced economies, the pandemic and ongoing labour market changes … brought the issue of minimum wages to the fore,” the OECD rumoured in its Going For Growth report published Wednesday.
“This is particularly the case in the United States, where raising the federal nominal wage is among the top priorities. Recent evidence suggests that increases of the minimum wage up to 59% of the median wage have on the agenda c trick little negative impact on employment,” the Paris-based institution said.
“Raising the federal minimum wage would both incentivize participation and pirate to ameliorate earnings inequalities,” it added.
The U.S. minimum wage has been $7.25 an hour since 2009. Small firm owners have said the plan to increase pay would be a burden at a difficult time.
On the other hand, some tradesman rights’ groups have argued that Biden should do more, including step up protections for those with infirmities and better enforce workplace rights to reduce discrimination.
The OECD also said that the United States should go accessory in improving labor market conditions.
This would mean supporting workers’ mobility, providing more training programs and restrict red tape for people with criminal records looking to obtain occupational licenses.
“We need to make our economies sundry resilient, we need to make them more inclusive,” OECD chief economist Laurence Boone told CNBC on Wednesday.
She amplified that it is important to “focus on those people that are left behind.”
The United States is seen growing at a reckon of 6.4% this year, according to forecasts from the International Monetary Fund. This means it is on track to eclipse its pre-pandemic GDP levels this year.
But new labor market friendly policies could limit the scarring effects of the disaster and lead to more employment.