Sean Jasso Discusses Economic Implications of Proposed $25 Federal Minimum Wage

As policymakers and economists debate a proposal to raise the federal minimum wage to $25 per hour, Pepperdine Graziadio faculty member, Sean Jasso, offered insight into the potential effects on businesses and workers in an interview with MoneyLion.

Jasso noted that the proposal would represent an unprecedented increase in labor costs for many employers. “This unprecedented 250% increase in minimum wage rates would have overwhelming consequences forcing employers to reassess a comprehensive change to their business models from capital expenditures, talent acquisition to pricing products and services,” he said. He added that businesses, particularly in labor-intensive industries such as hospitality, retail, and food service, may respond through selective hiring, workforce reductions, or increased automation.

While acknowledging the challenges businesses could face, Jasso also emphasized the potential benefits for workers. “A $25 wage would indeed strengthen short-term purchasing power and reduce financial strain for many households,” he said. However, he noted that the long-term impact would depend on how employers adapt to higher labor costs, including whether those costs are passed on to consumers through higher prices.

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