Despite several years now of increases in the minimum wage in several states the national unemployment rate has dropped to ‘record levels’. Which is ironic since the biggest criticism of minimum wage increases are that it costs jobs. That argument was always a myth.
Raising the Minimum Wage is good for Business and the Economy
- Many economists agree that raising the minimum wage is a good idea.
- Small business owners don’t think the mw issue is a problem.
- A higher rate would reduce worker turnover while increasing productivity.
- A “10 percent minimum wage increase reduces poverty by about 2 percent.”
- “$15 minimum wage a surprising success for Seattle restaurant”
- “A July 2015 survey found that 3 out of 5 small business owners with employees support a gradual increase in the minimum wage to $12. The survey reports that small business owners say an increase “would immediately put more money in the pocket of low-wage workers who will then spend the money on things like housing, food, and gas. This boost in demand for goods and services will help stimulate the economy and help create opportunities.”” (source: U.S. Department of Labor)
Major Companies are Already Raising the Rate…on their own
- The Gap, Shake Shack, and Boloco pay workers significantly more than the current rate of $7.25.
- Amazon raises minimum wage to $15, urges rivals to follow
- Walmart Is Raising Its Minimum Wage To $11 An Hour After Sweeping Tax Reform (January 2018)
The American people support an Increase in the Federal Minimum Wage
- 80 percent of Americans, including 62 percent of Republicans support an increase.
- 63% of millionaires support an increase.
A low Minimum Wage costs Taxpayers
- Report: Walmart Workers Cost Taxpayers $6.2 Billion In Public Assistance
- “A $15 minimum wage would also save taxpayers an estimated $153 billion a year, according to a study by the University of California, Berkeley. This is because companies that pay low wages force workers to get food stamps and other benefits to help offset their low wages.” (source)
Wage Increases are Being Fought Against by Big Business:
- The Arizona Chamber of Commerce and Industry, other business groups and the owners of three Phoenix-area Mexican restaurants on Thursday sued to block a new voter-approved measure that increases the state’s minimum wage to $12 by 2020. (12/2016)
Myths About the Minimum Wage
- Most people on the minimum wage are teenagers
- 90% of mw workers are older than 20 years of age.
- “Nationwide, these workers provide almost exactly half of their families’ income.”
- “Even among those making the rock-bottom wage of $7.25 an hour, teens” are a “minority.” (source)
- “Men, meanwhile, now make up 45 percent of low-wage workers, up from one-third in 1979.”
- Teens make up a “minority of those toiling at the baseline wage, at about 24 percent”
- “About half of minimum-wage employees are over 25 years old, and a quarter are between 35 to 64 years old.”
- “Their average age is 35, and 88 percent are at least 20 years old. Half are older than 30, and about a third are at least 40.” (source)
- ” In 1979, 27 percent of low-wage workers (those making $10.10 per hour or less in today’s dollars) were teenagers, compared with 12 percent in 2013,”
- MW rate increases lead to job losses:
- There is no evidence for that. In fact, the ur remains essentially unchanged.
- Paul Krugman, famous economist: “…the great preponderance of the evidence from these natural experiments points to little if any negative effect of minimum wage increases on employment.”
- ” In a letter to President Obama and congressional leaders urging a minimum wage increase, more than 600 economists, including 7 Nobel Prize winners wrote, “In recent years there have been important developments in the academic literature on the effect of increases in the minimum wage on employment, with the weight of evidence now showing that increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers, even during times of weakness in the labor market. Research suggests that a minimum-wage increase could have a small stimulative effect on the economy as low-wage workers spend their additional earnings, raising demand and job growth, and providing some help on the jobs front.”” (Source: U.S. Dept. of Labor)
- Would lead to a rise in inflation.
- A study showed that if Walmart raised their mw to $12/hour it would only cost their customers $.46 more per store visit. That amount would be far outweighed by benefits to workers by a significant increase in their wages. Many of those employees would then become customers, which would benefit Walmart.
Even Some Republicans, Conservatives Support an Increase:
- Bill O’Reilly Supports an Increase in the Minimum Wage
- Former Republican Presidential candidates, Mitt Romney and Rick Santorum, support an increase.