Call For $15 National Minimum Wage Grows Louder In Democrat-Controlled House
House Education and Labor Committee Chairman Bobby Scott (D-Va.) said today he plans to push ahead with his “Raise the Wage” legislation that would raise the federal minimum wage to $15 by 2024, despite opponents’ claims that it might create the loss of jobs and economic disruption.
The bill would require all employers nationwide to raise the minimum wage they pay employees to $15 over the next five years.
“The evidence clearly demonstrates the Raise the Wage Act is a reasonable proposal that would lift millions of workers out of poverty,” Chairman Scott said during his hearing on the subject today.
The hearing “is the first step toward passing a bill that reflects our shared belief that no one working full time should be living in poverty,” continued Scott, freely admitting that he expects to hear a rising tide of criticism from pro-business groups.
“I am confident we will hear dire projections about job losses that would result from gradually raising the minimum. But the overwhelming majority of research from both left- and right-leaning labor economists find few, if any jobs are lost when gradually raising the minimum wage,” Scott said.
“The reality is that -- by 2024 -- $15 an hour is the least a person would need to afford the basic essentials in anyplace in the country,” Scott said.
According to a living wage calculator developed by MIT, single working parents today, even in the poorest counties in the country, need at least $20 an hour to cover basic costs. “Workers should not be forced to work for poverty-level wages, regardless of where they live. And lower-cost regions should not be forced to continue to lag behind the rest of our economy,” Scott said.
New research from the National Bureau of Economic Research examined 138 minimum-wage increases between 1979 and 2016 and found that the overall number of low-wage jobs remained essentially unchanged over five years following minimum wage hikes.
Dr. Ben Zipperer, an economist at the Economic Policy Institute, told lawmakers there was no evidence that unemployment results from minimum-wage increases.
“Raising the national minimum wage is well overdue,” Zipperer said. “Workers today paid the federal minimum wage of $7.25 an hour, after adjusting for inflation, are paid 29 percent less than their counterparts 50 years ago. This is despite the fact the economy’s capacity to deliver higher wages has doubled in the last 50 years, as measured by labor productivity, or the amount of output produced by workers.”
Affected workers who work year-round would receive a raise on the order of $3,000 a year, as a result of the Raise the Wage bill, the economist added.
“This is enough to make a tremendous difference in the life of a preschool teacher, bank teller, or fast-food worker -- more than half of those working in each of these occupations earns less than $15 per hour today,” according to Zipperer, who said that low-wage workers today constitute a large portion of the workforce.
About 25 percent of all workers earned $13 or less per hour in 2018 and the vast majority of them would benefit from a minimum wage increase to $15 by 2024 he said.
The U.S. Chamber of Commerce said it is analyzing specifics of the bill and “open to a discussion on the federal minimum wage. That discussion should be based on actual economics rather than a predetermined, politically based number,” said U.S. Chamber Senior Vice President of Employment Policy Glenn Spencer.
“A $15 minimum wage would result in reduced hours for employees, fewer opportunities for first-time workers, and harm many employers, particularly small business, charities and nonprofits,” Spencer added. “A reasonable minimum wage bill would also include reforms and other provisions to help employers deal with increased labor costs,” he added. The group may seek to offset the effects of a higher minimum wage by attempting to negotiate greater flexibility for employers in other areas such as benefits and overtime pay, but is still analyzing the bill.
The Pasadena Chamber of Commerce said a survey of its membership reveals that employers have cut workers’ hours, overtime, bonuses, and benefits – and sometimes eliminated them, to cope with the city’s mandated minimum wage increases. Pasadena’s current minimum has been increasing annually since 2010 when the city council mandated annual hikes. It was increased to $13.25 in July, 2018 and will rise to $14.25 on July 1, 2019 and $15.00 by July 1, 2020.
The survey of businesses was conducted in January 2019, according to a statement from the Chamber, which is now asking the Pasadena City Council to defer planned wage increases to align with the State of California’s slower hike schedule.
The biggest number of Pasadena poll respondents, about 18 percent of them, are full-service restaurants. About 9 percent are traditional small retailers; 8 percent are office-based businesses, such as insurance, finance, etc.; 7 percent are non-profits, and 7 percent are consultancies.
Some 54 percent of companies said they raised the prices of their products, while reducing employee hours and workforce size.
Forty-one percent said they did not hire new employees, while 40 percent said they decreased their workforce, and 38 percent did not hire temporary or seasonal workers.
About 32 percent of businesses said they demanded a higher skill level from minimum wage employees, and 29 percent found other ways to reduce expenses, such as more aggressively bidding out supplies, foregoing health insurance, reducing employee benefits, eliminating employee bonuses, cutting marketing expenses, expanding off-site services that require fewer employees, and reducing donations to local nonprofits, the survey found.
Chairman Scott expressed skepticism of such findings throughout the hearing today. “Every time we propose raising the minimum wage, opponents repeat a familiar set of taking points that have been repeatedly contradicted by evidence and research,” he said.
Scott maintains that his bill will stimulate local economies across the country.
The lawmaker said the legislation’s five-year minimum wage step-up would also generate $120 billion in additional wages, which will flow back into local businesses.
“Whereas the Republican tax bill gave the largest benefits to those who needed it the least, this bill puts money directly into the hands of those who are most likely to spend it in their communities,” Scott said.
Next Article Previous Article