Authors of Montgomery County’s Minimum Wage Study Quiet as Questions Remain

Company denied interview request about study’s methodology


The cover page for the PFM minimum wage study commissioned by Montgomery County

As supporters of increasing Montgomery County’s minimum wage to $15 per hour criticize a county-commissioned study that predicted massive job losses, the Philadelphia-based financial research firm that composed the report is remaining quiet.

PFM, which bills itself as a consulting firm that offers financial advice to governments and other clients, on Monday declined Bethesda Beat’s request for an interview with the 146-page minimum wage study’s authors.

“While we are unable to comment on this study at this time, we recommend that you reach out to the Montgomery County Office of Public Information,” PFM marketing specialist Ayesha Mays wrote in an email to Bethesda Beat.

The county paid $149,600 for the study, which County Executive Ike Leggett commissioned.

Last week, proponents criticized the methodology of PFM’s report for relying on surveys of county business owners who likely know the County Council is considering increasing the minimum wage to $15 per hour by 2020. Proponents said the owners have an incentive to overestimate the number of jobs they think would be lost, hoping to torpedo a measure they oppose.

The report predicted 47,000 jobs would be lost in the county, and an aggregate income loss of $400 million, if the county increases the minimum wage from the current $11.50 to $15 per hour by 2022. It also noted 65 percent of the business owners surveyed either opposed or strongly opposed increasing the minimum wage to $15 per hour, while 24 percent supported doing so.

Leggett’s spokesman, Patrick Lacefield, the director of the county’s public information office, has defended the study by saying that, to predict job losses, PFM needed to survey the owners whose businesses could be affected by the proposed minimum-wage increase.

County Council members who previously voted for the $15 minimum wage bill that Leggett vetoed this year have also questioned the study’s methodology. Council member Marc Elrich called the job loss number “laughable,” while Hans Riemer called PFM’s findings “ludicrous.”

Last month, Elrich introduced a new version of the $15 minimum wage bill that pushed back its implementation for businesses with 25 or fewer employees until 2022. Larger business would have to pay the $15 per hour by 2020.

Council President Roger Berliner has scheduled a briefing on Sept. 19, when, he said, the council can question the study’s authors about the results. The briefing is scheduled soon after the council returns from its annual summer recess.

Berliner was one of four members of the all-Democratic council to vote against the earlier bill, which passed the council by a 5-4 vote, but lacked the 6-3 majority needed to overcome Leggett’s veto.

Last week, Berliner sent an email to his council colleagues noting he has a number of questions about the study’s methodology. He encouraged his colleagues to create a list of written questions for PFM so council members have written responses from the company before the September briefing.

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