In 2019 House Democrats passed the Raise the Wage Act. It would lift the federal minimum wage from $7.25 to $15 in 2025. How many and what kinds of people would such a $15 minimum wage help? And by how much? Here are key takeaways from research by David Cooper at the Economic Policy Institute.
1. The $15 minimum would lift 23.2 million workers directly and 10.2 indirectly as employers raise wages above $15 to attract and keep employees. More than 33 million workers would get a raise. That's about a fifth of the U.S. work force, and equivalent to the combined population of Belgium, the Netherlands, and Denmark. In other words, a lot of people.
2. What kinds of people will the new minimum help the most? Will it mainly lift teens who, in the conservative narrative, do not need help because they live at home and, apparently, come from affluent families? The simple answer is no.
--Most of those who would gain from the new minimum would be at least 20 years old.
--Two of three would be full-time workers.
--Two of three would be women.
--Almost 5 million of those helped would be single parents.
--6.2 million would come from the population labeled poor by the federal government. (Sad to say, many will still be poor, whether or not $15 lifts them above federal poverty lines. Even for a full-time, year-round worker, $15 an hour is just over $31,000 a year. That will not make a person in high rent areas or an adult with one dependent in almost any location unpoor.)
3. In which business sectors will the most employees get a bump? 19.6% of all the gainers would be in the retail sector, 18.6% in restaurant and food services, and 13.6% in healthcare.
4. What will be the average increase for an affected worker over what her pay would have been otherwise? The total dollar increase for a year-round worker will amount to $2,800, or 13.3%.
5. In which states would workers get the largest benefits? Many of the answers almost write themselves. Workers in states with weak or no minimum wage laws will gain a lot. In almost every southern state, workers would gain significantly more than the national average of a 13.3% hike. Working poor people in Texas would get a 17.5% increase and those in Mitch McConnell's Kentucky would get an 18% hike. Non-southern states that get a higher than average boost from the $15 federal wage include Wyoming, Idaho, Utah, Oklahoma, Wisconsin, and Pennsylvania. States whose workers get little boost from the federal $15 wage must be doing something right. Some are already climbing. They include California, Colorado, Missouri, New York, Oregon, Vermont, and Arizona.
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The main source for this post is an Economic Policy Institute Fact Sheet by David Cooper, Raising the Federal Minimum Wage to $15 by 2025 Would Lift Wages for over 33 Million Workers (July 17, 2019).
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Frank Stricker is a board member of the National Jobs for All Network and emeritus professor of history at California State University, Dominguez Hills.
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