The Latest Good News On The Minimum Wage
A few weeks ago, we wrote about a number of states around the country that aren’t waiting for Congress to raise their minimum wages. This week brings yet more big news for those of us who believe that raising the minimum wage is a critical step in creating an economy that works for everyone, not just the wealthy few. Here are a few of the top stories:
1. Gap, Inc. Will Raise Its Minimum Wage To $10. The retail clothing chain announced its decision yesterday, which is estimated to affect 65,000 U.S. employees. “To us, this is not a political issue,” GAP Chairman and CEO Glenn Murphy said. “Our decision to invest in frontline employees will directly support our business, and is one that we expect to deliver a return many times over.” Gap joins other chains like Costco, Whole Foods and In-N-Out Burger in embracing higher wages because employees work harder and stay longer after wages increase.
2. Nonpartisan Study Finds Raising Federal Minimum Wage To $10.10 Would Raise Earnings For 16.5 Million Workers. The report, from the Congressional Budget Office, also estimated that the increase would result in $31 billion in more earnings and would lift 1 million out of poverty.
3. Economists Dispute The CBO Estimate That Raising The Minimum Wage Would Cost 500,000 Jobs. The one piece of bad news in the CBO report was its estimate that 500,000 jobs would be lost as a result of a minimum wage increase to $10.10. However, numerous economists who study these impacts have disputed the methodology used. The New York Times Editorial Board, which supported raising the minimum wage in the wake of the CBO report, explains in plain language: “The budget office didn’t do its own research on those variables. It surveyed the economic literature on the subject, and chose a figure more conservative than the most recent and rigorous studies have found.”
4. Wal-Mart Announced It Would No Longer Oppose Certain Increases In The Minimum Wage. The largest private employer in the U.S. will not oppose minimum wage proposals as long as they have provisions to “manage the impact,” like a phase-in period, according to their Vice President of Corporate Communications, David Tovar. Tovar also indicated that the company is “looking” at throwing its support behind a proposal.
5. Iowa State Senate Committee Approves Minimum Wage Increase To $10.10 By 2016. A bill to raise the minimum wage in the state cleared this key procedural hurdle yesterday morning by a 7-4 party-line vote. “Nobody that works full time should live in poverty,” State Sen. Jack Hatch said. “This should not be a partisan issue, this is about working people struggling to provide the very basics for their families.”
6. State Lawmakers Will Try To Live Off Of The Minimum Wage For A Week. Five Minnesota lawmakers are raising awareness for the cause by taking the “Minimum Wage Challenge” and living off of a typical budget for a worker who makes the federal minimum wage of $7.25. The challenge allows $5 a day for food and $9 a day for transportation.
BOTTOM LINE: Momentum for raising the minimum wage continues to build. Gap, Inc. is leading the way in showing that higher wages will help, not hurt, businesses. The latest studies show that the benefits of increasing the minimum wage in additional earnings and decreased poverty rates far outnumber the potential costs. And lawmakers in the states continue to work to pass their own laws without waiting for federal action.