By Elizabeth G. Olson
FORTUNE -- A new non-partisan report has set off a storm of dueling arguments over the perennially testy question of raising the minimum hourly wage.
The proposal, by Democrats, to raise the minimum wage to $10.10 per hour would bring some 900,000 families above the poverty line and boost the income of an additional 16.5 million workers, but any such pay increase could also cost the jobs of as many as 500,000 workers, an analysis by the Congressional Budget Office found.
Almost as soon as the report was released Tuesday, opponents began to cite the report in an effort to torpedo any Congressional vote to hike the federal minimum from $7.25 per hour to $10.10 by 2016.
One such detractor was House Speaker John Boehner, Republican of Ohio, who noted through a spokesman that, "While helping some, mandating higher wages has real costs, including fewer people working.
"With unemployment Americans' top concern, our focus should be creating -- not destroying -- jobs for those who need them most."
Supporters of the proposal rallied to defend the proposed wage increase, noting that an array of economic studies examining prior increases had established that job losses would be minimal.
"Zero is a perfectly reasonable estimate of the impact of the minimum wage on employment," said Jason Furman, chairman of the Council of Economic Advisers, in a conference call with reporters to respond to the CBO findings.
Joseph Stiglitz of Columbia University, one of 600 economists who signed a letter endorsing a rise in the minimum wage, said, on a separate conference call, that the CBO "has underestimated the benefits and overestimated the costs."
He and other economists on the call said the CBO report did not consider how additional wages will increase productivity and reduce turnover, absenteeism, and dependence on federal benefits.
"The cost," Stiglitz noted, "is typically passed on. And, yes, it does come at the expense of the upper-income individual, but they are doing well, and this only rectifies the inequality to a minor extent."
Overall, as many as 27.8 million workers could see more money in their pockets with a minimum wage rise because other workers who are already earning in the $10 range would likely receive boosts to their paychecks, the economists said.
President Obama initially supported a federal minimum age of $9 per hour, but has since backed the larger increase as Democrats seek to make the effort a campaign issue this fall.
The CBO analysis looked at the effects of both $9 and of $10.10 minimum wage, but concluded the lower amount would lift only 300,000 workers above the poverty line, but could result in 100,000 jobs being lopped off. The rise to $10.10 would bring three times as many workers out of poverty, but could translate into a loss of an estimated half-million jobs, according to the CBO.
The proposal is expected to face a vote in the Senate later this year, and may pass, but it will likely to be avoided by the Republican-dominated House.
Proposals to lift the minimum wage typically are fraught efforts as business owners, particularly those in the food industry, warn they will need to fire people to offset the higher salary requirements, and that customers will not pay higher prices to support the wage increases.
That's been accepted wisdom by many until higher-wage proponents began arguing that many low-wage workers rely on publicly financed benefits such as food stamps to make ends meet. Rallies have been held at fast-food outlets in a number of cities over the past year to highlight the connection between taxpayer subsidies and the lower wages companies pay.
Critics have argued that minimum-wage jobs are starter jobs held by teenagers for spending money, but recent studies have found that most of these workers are in their 30s, have children, and work full-time.
Skirmishes over raising the wage floor date back to 1938, when the first law was passed to set a minimum wage amount, and nearly every effort to raise it has brought accusations of government interference.
The faculty strike at University of Illinois at Chicago is the latest episode in an ongoing effort by unions to gain influence on America's college campuses.
FORTUNE -- On Tuesday, faculty members at the University of Illinois at Chicago went on strike for the first time ever as part of a two-day walkout aimed at securing a union contract and increased wages.
The union, which represents 1,150 tenured and non-tenured professors, won MOREClaire Zillman, reporter - Feb 19, 2014 11:32 AM ET
A Poets&Quants analysis of 2013 employment reports at most of the world's top business schools shows that there was no shortage of extraordinary pay days for the best and brightest MBA grads.Jan 28, 2014 9:51 AM ET
For several reasons, the SEC's proposed rule to address the growing CEO-average worker pay gap will not work as intended. Here's an alternative approach.Sep 27, 2013 5:00 AM ET
Why do more women than men earn college degrees? The reasons are complex, but new research suggests that money plays a big role.Anne Fisher, contributor - Mar 27, 2013 10:02 AM ET
Whether you are an independent consultant or freelancer who charges by the hour, day, week, or project, you are trading time for money. A few tips on giving your work a proper price.
By Katherine Reynolds Lewis
FORTUNE -- For many, being self-employed offers a promise of doing fulfilling work on your own terms. But along with that independence comes a dizzying array of decisions. One of the toughest of these MOREJan 9, 2013 8:38 AM ET
A scant 5% of workers in a new poll want to socialize with colleagues this holiday season, while 73% say they'd rather get a bonus. By Anne FisherAnne Fisher, contributor - Nov 28, 2012 12:19 PM ET
Asking for a million-dollar salary in jest can actually increase your pay package, according to a recent study. Here's how.
By Karawynn Long
FORTUNE -- There comes a point in every successful job interview when it's time to talk money. The standard advice to job applicants has long been to play it coy.
John Challenger, CEO of outplacement firm Challenger, Gray, and Christmas, urges applicants to "let the employer name a salary MORENov 9, 2012 11:18 AM ET
While overall pay held steady from last year, MBA students who ventured into some of the hottest fields experienced healthy increases in starting salaries. By John A. ByrneAug 27, 2012 12:06 PM ET
Like the prospect of criminal prosecution, clawbacks can seem less like a real threat and more like a sop to public clamor for tangible punishment. By Elizabeth G. OlsonAug 16, 2012 9:28 AM ET
|Chrysler Group orders donated Vipers destroyed|
|Albertsons to merge with Safeway|
|Everything must go: There's a flood of store closings|
|The real reasons to export U.S. gas|
|Boeing to end pension plans for non-union employees|