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.

As of 2017, the federal minimum wage was worth 25 percent less than it was in 1968.

There are 7 states that have no minimum-wage law or a minimum wage below the federal minimum wage. The federal minimum wage applies in all of these states.

Publications

Media

Wages for American workers are ticking upward, but the US remains one of the world’s most inequitable nations

From PRI:

Last week it was reported that average hourly wages of American workers grew 2.9 percent over the past 12 months. It’s a good sign, but American workers still have a lot of catching up to do and income inequality and wage stagnation remain major concerns…Yes, national wages inched up last year. But consider this statistic from Michelle Webster with the Colorado Center on Law & Policy: “In 2016, median earnings for workers in the state were 2 percent less than what they earned in 2000″ when adjusted for inflation.

Media

Bill would raise minimum hourly wage to $15

Hawaii’s hourly minimum wage would increase over two years to $15 by 2020 under a proposal advanced Tuesday by the Senate Labor Committee.

Senate Bill 2291 would raise the state’s minimum wage from $10.10 an hour to $12.25 per hour in 2019, and to $15 per hour the following year — a 48 percent increase overall. The rate increased to its current level on Jan. 1, the final of four annual increases that began in 2015.

Hawaii is one of 13 states with a minimum wage of $10 an hour or higher. An estimated 4.6 percent of hourly workers in the state, or about 30,000 employees, are paid the minimum wage, according to Bureau of Labor Statistics data.

The proposal was widely supported by labor organizations and individuals who said Hawaii’s high cost of living quickly eats up wages here, but was strongly opposed by employers who contend costs are too high.

The Hawaii Appleseed Center for Law & Economic Justice testified that at $10.10 per hour a person working full time with no days off earns $21,000 a year in gross income. “With the highest cost of living in the nation, mainly caused by sharp increases in the cost of housing, $10.10 is not a living wage for a single adult in Hawaii, much less adults supporting children and others,” the center said.

Media

Worker’s Friend Or Business Drag? One Year Of Colorado’s Increased Minimum Wage

On Monday, New Year’s Day, some workers in Colorado will get a pay raise. The minimum wage will increase 90 cents, from $9.30 to $10.20 an hour. This is because Colorado voters passed a law that gradually increases the minimum wage; by the final year of the plan, in 2020, it will grow to $12 an hour.

As was the case prior to the passage of Amendment 70 in November 2016, both proponents and those in opposition to it have made arguments about its impact after the first year. Sonia Riggs, president of the Colorado Restaurant Association, is against the increased wage. She tells Colorado Matters it will cause restaurants to close and create a greater pay disparity between servers and workers in the back of the operation, like dishwashers.

Michelle Webster, manager of research and policy analysis with the Colorado Center on Law and Policy, is for the wage increase. It’s an important means of elevating the economic impact of the state’s lowest-paid workers, Webster tells Colorado Matters.

Teens, Employment, and the Minimum Wage

More than 104,000 teens (16- to 19-year-olds) work and actively contribute to the Massachusetts economy. As working teens, they learn job skills and gain experience and responsibility. Many working teens also play important roles in helping meet financial needs for not only their families but also for themselves, like paying for college. Most teen workers (about 82 percent) earn near or at the minimum wage, which as of January 2017 was $11 an hour – finalizing a three-year phase-in of an $11 an hour minimum wage in Massachusetts. Currently, teens make up 12 percent of minimum wage earners. This brief looks at who teen workers are, their contributions to family income, how a subminimum wage could affect teen workers, and whether there have been adverse effects on teen employment from minimum wage increases.