In Minnesota, we currently have a number of bills in the legislature that propose to raise the minimum wage from between $7.50/hour to $10.55/hour. Yesterday, the JOBS NOW Coalition and University of Minnesota Labor Education Service hosted a panel of experts from the Center for Economic and Policy Research, the Economic Policy Institute and the University of Minnesota to discuss the relationship between the minimum wage and building a sustainable economy. The panel discussed the many dimensions to this issue and how a larger increase to the minimum wage would have a much more positive impact, not only for low wage workers, but Minnesota’s economy as a whole.
Here are some key takeaways from yesterday’s panel, via the JOBS NOW Coalition.
- Far from being a national leader, Minnesota is one of only five states or territories whose minimum wage is below the federal. The other four are Wyoming, Arkansas, Georgia, and Puerto Rico.
- Historically costs rise over time, and a dollar today buys less than a dollar a year ago, ten years ago, or forty years ago. If the federal minimum wage had kept pace with inflation and maintained it’s purchasing power since 1968, it would today be over $10.55 an hour, or $21,944 a year for a full-time worker.
- In Minnesota, raising the minimum wage to about $10.00 an hour would mean better wages for half a million workers. Some 78 percent of those workers are age 20 or older, and 35 percent are married or are parents.
- A growing number of economic studies show that increasing the minimum wage preserves jobs and may even stimulate small net increases in jobs. A nationwide study shows no job loss resulting from minimum wage increases from 1990 to 2006, even where a county on one side of a state border has a higher minimum wage than a county on the other side.
Near the end of the discussion, economist John Schmitt for the Center for Economic and Policy Research dispelled what he thought was the biggest myth about the minimum wage. He said that too often, people think that if workers are paid a low wage, it’s because that is what they are worth; but this is obviously not the truth. With decades of suppressing the minimum wage, busting unions, enacting unfair trade deals and creating an immigration policy that pits low wage workers against themselves, the decision for what a fair wage should be is almost entirely decided by anyone but the worker. It is this inequity in bargaining power that has lead to increased productivity and profits for employers and stagnant or decreasing wages for workers, as well as many other economic injustices. Ultimately, raising the minimum wage for all workers in Minnesota won’t completely solve this problem, but it’s a great step in the right direction.