Raising The Minimum Wage To $10.10 Could Lift Nearly 5 Million Out Of Poverty


Raising the federal minimum wage to $10.10 an hour could lift about 4.6 million people out of poverty directly, according to a new study from economist Arindrajit Dube. Longer-term effects could reduce the number of people living below the poverty line by 6.8 million.

That wage level “would reduce the poverty rate among Americans between the ages of 18 and 64 by as much as 1.7 percentage points,” Jillian Berman explains in the Huffington Post. Poverty increased by 3.4 percent during the recession, a rate that has not improved since, but a $10.10 wage would erase more than half of that uptick. Dube’s findings come from an analysis of 23 years of data on minimum wage increases as well as a review of previous findings.

Others have found similar numbers for how many could be brought above the federal poverty line by a higher wage: ROC United, a group focused on better working conditions for restaurant workers, found that a $10.10 wage would lift nearly 6 million people out of poverty.

The current federal minimum wage is $7.25 an hour, and it has stayed at that level for more than four years. That’s not enough to keep a parent who works for that wage full-time, year-round above the poverty line, nor is it enough to make market rent in any state. But the wage used to be enough to keep a family of two above the poverty line, and in the 1960s it was even enough to keep a family of three out of poverty.

A $10.10 wage makes sense in other ways. It would bring it in line with where it would be if it had kept up with inflation over the past half century. (To keep up with increases in all other workers’ wages, it would have to be $10.65, and to keep up with increases in worker productivity it would be $18.30.) Given that low-income workers are likely to spend a large portion of any extra pay, putting the money back into the economy, a $10.10 wage would boost GDP by $22.1 billion, supporting the creation of 85,000 new jobs. And Americans support such a wage: one poll found 80 percent support for it, including two-thirds of Republicans, and another found that two-thirds support a raise to $10.25 an hour.