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Phoenix economist says Biden’s higher minimum wage could hurt Arizona

(AP Photo)

PHOENIX – A Phoenix economist said communities with a lower cost of living, such as Arizona, could be stung by President-elect Joe Biden’s call to boost the federal minimum wage to $15 per hour.

Biden unveiled a $1.9 trillion coronavirus plan Thursday that included speeding up vaccines and $1,400 checks for most Americans.

It also shoehorns in long-term Democratic policy aims such as increasing minimum wage.

“Communities with a lower cost of living will be impacted severely if the federal minimum wage goes to $15 per hour,” Phoenix consultant Jim Rounds told KTAR News 92.3 FM on Thursday.

“Communities have very different cost of living numbers. For example, Arizona’s $12.15 per hour minimum wage already exceeds the $15 minimum wage in San Francisco and Seattle when you do it in real dollar terms,” he said.

Overall, he added, Biden’s proposal likely will push federal taxes higher in a state where about 100,000 remain out of work because of the pandemic.

“There’s a lot of pain out there and people are suffering,” Rounds said. “The stimulus package needs to be more focused on people getting a paycheck rather than being handed a government check.”

But if Arizona can recover the jobs, “that will add [an estimated] $500 million in state and local tax revenues to reinvest in the economy and that will grow over time.”

KTAR News 92.3 FM’s Jim Cross and the Associated Press contributed to this report.

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