The popular conservative response to those who want to increase the nation’s minimum wage, which currently stands at $7.25 per hour, is that doing so will inevitably kill jobs at small businesses. However, studies have shown that raising the minimum wage does not kill jobs, but most certainly helps workers at the low end of the wage scale.
And according to a report from the National Employment Law Project, many of the companies that employ minimum wage workers could certainly afford to increase wages, since, contrary to popular perception, they are the nation’s biggest corporations. Those companies have largely recovered from the recession:
– The majority (66 percent) of low‐wage workers are not employed by small businesses, but rather by large corporations with over 100 employees;
– The 50 largest employers of low‐wage workers have largely recovered from the recession and most are in strong financial positions: 92 percent were profitable last year; 78 percent have been profitable for the last three years; 75 percent have higher revenues now than before the recession; 73 percent have higher cash holdings; and 63 percent have higher operating margins (a measure of profitability);
– Top executive compensation averaged $9.4 million last year at these firms, and they have returned $174.8 billion to shareholders in dividends or share buybacks over the past five years.
The three largest employers of minimum wage workers, Wal‐Mart, Yum! Brands (Pizza Hut, Taco Bell, and KFC), and McDonald’s, all are more profitable than they were before the Great Recession:
House Democrats have been circulating a bill to raise the minimum wage to $10 per hour, catching the wage up to the purchasing power that it had in the 1960s.