Policy: Economy

Support grows for hike in minimum wage

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Raising the federal minimum wage is gaining momentum as state and local governments increase their rates and Democrats look to push the issue as a winning campaign pledge ahead of the 2014 elections.

Minimum wage increases got a boost this year from successful measures around the country. California, the most populous state, led the way by legislating a rate hike to $9 by 2015 and $10 by 2016. There were also hikes in New Jersey and New York, as well as in places like the Seattle-Tacoma International Airport, which raised its wage to $15. And labor unions have been pushing fast-food workers around the country to agitate for a $15 “living wage.”

That momentum will carry over to the federal level next year, although the chances of an increase passing the Republican-led House are slim. Still, Senate Majority Leader Harry Reid, D-Nevada, has promised a “sustained effort” to pass a hike when Congress returns in 2014.

A December Wall Street Journal-NBC News poll found that 63 percent of Americans would favor raising the minimum wage from its current $7.25 hourly rate to $10.10, the amount in a bill introduced by Democrats Tom Harkin of Iowa in the Senate and George Miller of California in the House.

Support for the increase is strong among Democrats, four out of five of whom favor the hike. But it's not just Democrats: 59 percent of independents support a $10.10 rate. Even Republicans and Tea Party fans are divided on the issue, with 47 and 44 percent support, respectively.

Republicans privately admit that they don’t have a quick, media-friendly response to Democrats’ assertions that raising the minimum wage would provide an economic boost for families near poverty and would combat income inequality. Research

on the overall impact of minimum wage increases is mixed, but businesses generally oppose them on the grounds that they would raise costs and reduce employment.

“It’s a lot simpler message on the advocates’ side than it is to explain the day-to-day way businesses operate,” acknowledged Scott DeFife, executive vice president for policy and government affairs for the National Restaurant Association, saying that “our task is to explain the business of the restaurant industry and to explain usually over and over again in as fine detail as need be.”

About 44 percent of minimum-wage earners work in food preparation, according to the Bureau of Labor Statistics. Of that group, 80 percent are teenagers, DeFife said, cautioning that many of them are first-time workers for whom working at a low wage is an opportunity to join the labor force.

Although the odds of federal legislation passing quickly are remote, one possibility is that by raising the pressure on the issue, Democrats can negotiate for a bigger wage hike when the political environment is more hospitable.

They have already moved President Obama on the issue: In his State of the Union address last January, he called for increasing the rate to $9 and indexing it for inflation. But in November he lent his support to the Harkin-Miller bill and the higher $10.10 rate.

The difference between the two rates is significant given that occupations like fast-food cooks and cashiers have median earnings of just over $9, according to the BLS. That means that the Harkin-Miller bill would affect a majority of those workers, whereas Obama’s original $9 proposal would have a much more limited impact.

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