Overdue minimum wage increase proposed

Photo by Hugh McQuaid

On Jan. 31, Speaker of the House Chris Donovan and Democratic lawmakers proposed the minimum wage be raised by $1.50 per hour over the next two years, and indexed to rise with the cost of living.

This proposal would raise the minimum wage from $8.25 to $9.00 an hour this year and to $9.75 next year. After that, the wage would rise automatically as the Consumer Price Index rises.

"The current minimum wage is not enough for working families to get by", said Donovan. "A family of three with one person working would earn $17,160 a year under the current minimum wage. That’s $5,000 under the poverty line. So people are working, putting in 40 hours week 52 weeks out of the year, and their earning poverty wages.”

About 106,000 people in Connecticut earn the minimum wage and around 83 percent of them are over the age of 20, he said. "Many of the jobs that the state has gained as its worked its way out of the recession have been low paying," Donovan added.

“We have mothers and fathers who lost their jobs and are now trying to make ends meet and the jobs that are available to them, because they want to work, are minimum wage jobs. We have to do our best as a society, as members of the General Assembly to say, ‘We understand that you’re working hard and we want to make sure you get enough wages that you are not poor,’” he said.

"This change has been long overdue," said Sharon Palmer, president of AFT Connecticut. "It has been years since we increased the minimum wage. Where we used to be a leader, Connecticut is now behind many other states."

If Connecticut moved to an indexed minimum wage it would join nine other states that have adopted a similar system.

Andrew Markowski of the National Federation of Independent Business, said raising the minimum wage would be the worst thing for small businesses at this time.

"The business industry has said that every time our state has raised the minimum wage and not once has it resulted in the loss of jobs," said Palmer.

Rep. Diana Urban, an economist, said almost everyone in the field agrees that as long as the increase in the minimum wage isn’t greater than 10 percent, it doesn’t have a negative impact on employment.

“This is because it gives the chance for markets to adjust and adjust they do,” she said. "Increasing the minimum wage gives the economy a direct boost because minimum wage earners spend their money."

“If we’re looking for a bump up in the economy, we’re looking at approximately $71 million that our minimum wage earners will pump right back into the demand side of the equation,” she said.

House Minority Leader Larry Cafero agreed with the idea of indexing minimum wage with the cost of living. "I think there’s a fairness about that. If people are doing better and costs are going up, the wages should go up. If we’re not doing that well and costs have stagnated, they should not go up,” he said.

If the minimum wage had kept pace with inflation since the 1960s, it would be well over $10/hr today.

Stagnant wages are boosting corporate profits. In fact, the biggest employers of low wage workers like McDonald's and WalMart have seen their corporate profits and CEO pay top pre-recession levels. Meanwhile, wages haven't been such a low share of GDP in 40 years. And poverty level wages are bad for our communities.

Raising the minimum wage would provide a much-needed boost to our economy. Putting a little more money in the pockets of low wage workers helps them afford necessities -- from groceries to school supplies to winter clothes. That money gets spent at local businesses, and injected right back into the economy.

Boosting demand at local businesses will help spur hiring to meet the rising demand. And that will help communities across Connecticut recover from these difficult times.

Tell the state legislature to raise the minimum wage and tie it to inflation.

http://salsa.wiredforchange.com/o/1306/p/dia/action/public/?action_KEY=5374

There's no better way to boost our economy than from the bottom up.