Is it time to raise the minimum wage in the United States again? Eighteen states already have set minimum wages higher than the federal minimum wage, as of January 1, 2012 according to a U.S. Department of Labor webpage1.
The federal minimum wage has been $7.25 per hour since 2009 for jobs subject to the minimum wage law. The history of the minimum wage is displayed on another U.S. Department of Labor webpage2.
Of course some persons are exempt from the minimum wage law. But the majority of workers are covered by it.
Many minimum wage workers currently get help from various sources, including the federal government. Indeed, many workers who work fulltime at the minimum wage remain eligible for various government benefits such as food stamps, subsidized housing, Medicaid, etc. Such workers may get more income from various government agencies than they do from their fulltime jobs. This is often even more true for many part-time workers. Other minimum wage workers are teenagers whose parents pay their basic living costs.
There is a place for low-paid workers. Indeed, doing volunteer work for no pay at all is a good way for young people to learn skills and retirees to remain active. But I feel that persons who are paid employees deserve to be paid a fair living wage.
Workers in several other countries may work harder, longer hours, under more unsafe conditions, and for lower pay. Such problems even contribute to some of the violence around the world. These nations need to pay entry level workers more, too – and international companies can help by raising wages they pay workers there. But this article focuses on conditions in the United States.
The argument can be made that raising the minimum wage costs jobs as employers lay people off or cut back on their hiring. And some minimum wage jobs require minimum skills and minimum work. But increasingly even entry level minimum wage jobs attract well-qualified college graduates willing and able to work hard. Also, there are a lot of skilled minimum wage workers who lack college degrees but are well educated/qualified in other ways. Furthermore, many of these jobs can't be easily exported overseas -- a lot of those than can be already have been.
Competition for jobs sometimes currently results in many persons competing for minimum wage jobs. This may make employers feel that supply and demand economics rules out the need for a raise in the minimum wage. But if such workers are getting government benefits, it is a case of taxing one side to subsidize another. Paying workers a living wage seems preferable -- even more so as the economy recovers.
Since it has been nearly three years since the minimum wage was raised, while the cost of living has increased, I support raising the United States minimum wage again. I recommend considering a 50 cent raise to $7.75 effective January 1, 2013, with an additional 25 or 50 cent raise January 1, 2014. The amount and dates of course are subject to negotiation by persons more skilled and knowledgeable than I. But a pay raise for low paid workers might stimulate the economy by increasing purchasing more than many other proposed economic stimulus measures. What do you think?
Endnotes:
1“Minimum Wage Laws in the States – January 1, 2012”; U.S. Department of Labor; webpage accessed April 21, 2012.
2“History of Federal Minimum Wage Rates Under the Fair Labor Standards Act, 1938 – 2009". Webpage accessed April 21, 2012.
