Minimum Wage

The federal minimum wage was established in 1938, as part of the Fair Labor Standards Act (FLSA), to ensure that all work would be fairly rewarded and that regular employment would provide a decent quality of life. Congress makes periodic amendments to the FLSA to increase the federal minimum wage; however, since the 1960s, Congress has adjusted the federal minimum wage infrequently, enacting raises that have never been adequate to undo the erosion in the minimum wage’s value caused by inflation. This decline in purchasing power means low-wage workers have to work longer hours just to achieve the standard of living that was considered the bare minimum almost half a century ago. The decline in the value of the minimum wage has contributed to wage stagnation, and is directly responsible for widening inequality between low- and middle-wage workers.

In light of Congressional inaction, many states, cities, and counties have enacted their own higher minimum wages, with EARN groups providing the key research and analysis evaluating proposed minimum wage increases. In doing so, they are taking steps to help workers afford their basic needs, bring them closer to the middle class, and ensure that even the lowest-paid workers in their jurisdictions will benefit from broader improvements in wages and productivity.

Publications

Economic Agenda for a Thriving Commonwealth: Improve Job Quality

Improving job quality and economic security is one of the five key strategies in KCEP’s “Economic Agenda for a Thriving Commonwealth.” Kentucky can make real progress in these areas by updating existing and enacting new commonsense job quality standards. The successful experience of states that raise standards shows businesses benefit through increased productivity, reduced turnover and stronger consumer spending. Our whole commonwealth will benefit when paychecks better reflect the contributions Kentuckians make through work every day, and when work supports rather than detracts from leading healthy, fulfilling lives.

New Mexicans are Worth More: Raising the State’s Minimum Wage

While a handful of New Mexico municipalities – including the cities of Albuquerque, Las Cruces, and Santa Fe, and Bernalillo and Santa Fe counties – have raised their minimum wages in recent years, the state-wide minimum wage has not been raised since 2009. Still at $7.50 an hour, its purchasing power has eroded considerably over that timeframe. In fact, when you factor in inflation, that $7.50 buys only $6.30 worth of goods today.[iii] If the wage had been adjusted for inflation, it would now be $8.95 an hour. While New Mexico’s minimum wage has remained stagnant and lost purchasing power, 28 states, including Colorado and Arizona, have increased their state minimum wages.[iv] As these states have found, raising the minimum wage benefits thousands of working families and local economies.[v]

In order for children to have nourishing environments where they can thrive, families need to be economically secure so they have the ability to invest in their children’s futures. If the state passes legislation to increase the minimum wage incrementally until it is $12.00 an hour by 2022 – and protects workers by prohibiting training wages and allowing municipalities to enact even higher wages – nearly a quarter of a million workers will see their wages rise as $204.8 million a year is added to their paychecks. This achievable policy reform will vastly improve the state’s overall well-being and give families, children, older adults, people of color, and women more opportunities to thrive. Local economies will see benefits as well.

At the Wage Floor: Covering Homecare and Early Care and Education Workers in the New Generation of Minimum Wage Laws

  • May 22, 2018
  • COWS
  • Sarah Thomason, Lea Austin, Annette Bernhardt, Laura Dresser, Ken Jacobs, and Marcy Whitebook.

In November 2012, fast-food workers in New York went on strike and the Fight for $15 was born.
Over the last five years, the movement has lifted wages for more than 17 million workers across the
nation by fighting for and winning numerous minimum wage policies (National Employment Law
Project 2016). Substantial minimum wage increases are underway in California, New York, Oregon,
and more than 30 cities and counties around the country. In states and cities covered by them, these
new minimum wages will increase earnings for 25 to 40 percent of workers (Reich, Allegretto, and
Montialoux 2017; Reich et al. 2016). After four decades of wage stagnation and rising inequality, the
movement has delivered real, much needed, and meaningful progress in a remarkably short period of
time.

Clearing the Air Around the Texas Minimum Wage Act

Recognizing that the federal minimum wage falls short of what families need to make ends meet, other states and cities across the country have raised their minimum wages above the federal level of $7.25 an hour. No Texas cities have done this because Texas state law currently stops cities and counties from making most local decisions about the minimum wage. Local governments are only able to raise minimum wages for their own government employees and contract workers.  What cities can do, however, is to insure that other benefits like paid sick time are available to all workers in that city which is what the City of Austin has done.

But how did we get here on the dollar minimum wage?