Education and Workforce Committee Democrats Call on Republicans to Support Legislation to Address Growing Income Inequality and Stagnant Wages

WASHINGTON – The Subcommittee on Workforce Protections held a hearing today, entitled, “Reviewing the Rules and Regulations Implementing Federal Wage and Hour Standards.” At the hearing, Democratic Members of the Education and the Workforce Committee called for Congress and the Department of Labor to continue standing up for working families by raising the minimum wage, and improving overtime protections for low-wage workers through the Fair Labor Standards Act (FLSA). Ranking Member Robert C. “Bobby” Scott highlighted the need to raise the minimum wage and strengthen workplace protections.

 

“While the average CEO now makes 296 times more than the average worker, middle class wages have remained stagnant and wages for low-wage workers continue to decline,” said Ranking Member Bobby Scott (D-VA). “This trend shows the great need for us to strengthen the bargaining power between low-wage workers and their employers as intended by the Fair Labor Standards Act. We have to ensure that workers are receiving a fair share of the wealth they create. By passing legislation that allows women to fight income inequality in the workplace, raising the minimum wage for 35 million workers and improving overtime regulations, we can restore workers’ dignity and their ability to provide for their families.” 

 

At today’s hearing, Subcommittee on Workforce Protections Ranking Member Frederica S. Wilson addressed disparities in income equality, and the need to ensure that our economy is not built on the backs of low wage workers who tend to fall behind.

 

“The Fair Labor Standards Act reflects one of our closest held beliefs—that all American workers deserve the right to work with dignity,” stated Subcommittee Ranking Member Frederica S. Wilson (D-FL). “For 77 years, the FLSA has been a powerful tool in helping workers assert their rights to fair wages and reasonable hours. Income inequality threatens to gut our middle class, create a permanent underclass, and dismantle the American dream of building economic wealth and financial stability. We cannot afford to roll back the protections guaranteed by FLSA. We cannot go back to a time when economically vulnerable workers faced the illusory choice between working for far less than their worth and not working at all. Congress must update this tool in order to combat the growing threat of income inequality.”

 

American workers who earn the federal minimum wage are currently making less than $15,000 a year. The Raise the Wage Act—cosponsored by over 160 Democrats in the House and no Republican supporters—would raise the minimum wage to $12 per hour by 2020. The legislation would also give 35 million American workers a fair day’s pay for a fair day’s work, and invest $80 billion back into our nation’s economy.  The Democratic witness, Professor Seth Harris, touched on the importance of wage growth for middle class families and the economic impact of putting more money in the pockets of hardworking Americans.

 

“The wages crisis has been devastating for America’s families as they have struggled to maintain their standard of living and middle-class status. Yet, the wages crisis has also hurt our economy,” said Professor Seth Harris, who testified at today’s hearing. “Seventy percent of the U.S. economy is consumption—that is, working class and middle class families, among others, buying goods and services. These families spend a much higher percentage of their incomes on consumer goods and services than higher income families spend. In other words, if a minimum wage worker earns an additional dollar, that entire dollar will be spent on groceries or pay rent to support her family. That dollar goes directly back into the economy. If a millionaire or billionaire earns an additional dollar, he is much more likely to save that dollar than spend or invest it. Thus, our economy grows more when working class and middle class families increase their incomes than when wealthy people increase their incomes.” 

 

It was also noted during the hearing that today is the 52nd anniversary of the passage of the Equal Pay Act.

 

Research shows that despite women being the primary breadwinners for six out of ten families, women are still only paid $0.78 for every dollar paid to their male counterparts. In addition to calling for a raise in the minimum wage, Democrats urged their colleagues across the aisle to strengthen the Equal Pay Act by passing the Paycheck Fairness Act, which would give working women the tools to fight gender discrimination in the workplace. They also highlighted the need for an increase of the overtime exemption threshold.