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Other recent research underscores the value of raising the minimum wage now and deflates many conservative talking points. David Cooper of the Economic Policy Institute shows that, contrary to the conservative notion that the typical minimum wage-earner is a kid supplementing his middle-class family’s income, 52% are in households with income of less than $40,000 a year. One third are ages 30 to 55 — in fact, more are older than 55 than are teenagers. The average share of family income that would be provided by a minimum wage earner at $10.10 is 50%.
Findings like these are helping to drive the movement for increases in the minimum wage at the state and local level.
Los Angeles Times January 17, 2014 -
PRESIDENT OBAMA has assured American workers that he won’t let Congress keep him from lending a hand during these tough economic times. “I will not allow gridlock, inaction or willful indifference to get in our way,” he said in a speech last year. “Whatever executive authority I have to help the middle class, I’ll use it.”
The problem is that most presidential actions that could help significant numbers of middle-class workers do require congressional participation. But here’s one that doesn’t: raising the salary threshold for the exemption to the overtime rules of the Fair Labor Standards Act of 1938.
New York Times January 17, 2014 -
In setting the so-called tipped minimum wage lower than the rate of other workers, states presume that the gratuities tipped workers earn will amount to at least the minimum wage rate. If it doesn’t, employers are supposed to pay the difference. But that doesn’t always happen. Between 2010 and 2012, the Department of Labor conducted nearly 9,000 wage and hour investigations throughout the country in the full service sector of the restaurant industry and found a violation rate of 83.8%.
While it’s likely that not all violations have to do with underpaying tipped employees, the statistic sheds light on how hard it is to ensure that these workers make minimum wage. David Cooper, an economic analyst at the Economic Policy Institute explains it this way: “Imagine you’re a tipped worker at Denny’s. The expectation is that you record the hours you worked and the tips you made and calculate the overall wage you received. If it’s less than the minimum wage, you’re expected to go to your employer — the guy who decides what hours you work or if you work at all — and tell him, ‘You didn’t pay me enough.'”
CNNMoney January 15, 2014 -
On Jan. 1, 13 states raised their minimum wage (by varying degrees), and on July 1, California will increase its by $1 an hour.
As a result, the Economic Policy Institute estimates about 4.6 million workers will see their wages increased, 2.6 million of whom are directly affected as the new minimum wage exceeds their current hourly pay. The other 2 million already make slightly more than the new minimum wage but will benefit from the ripple effect.
And it could well be the entire country that sees an increase soon. Congressional Democrats and President Obama are pushing to raise the federal minimum wage from $7.25 an hour to $10.10 by 2015.
CNNMoney January 15, 2014 -
Only about 1.6 million hourly workers currently earn the minimum wage, according the Congressional Research Service.
But the Economic Policy Institute, a liberal think tank that organized release of the letter, estimates that another 17 million hourly workers who now earn between $7.25 and $10.10 an hour would see higher wages over the three years of a phased-in increase.
And millions more who make above $10.10 would indirectly benefit if employers adjust pay scales commensurate with a minimum wage increase, EPI estimates.
The Miller-Harkin proposal would also raise the hourly base for workers paid in tips, initially to $3 from $2.13. After that, the proposal calls for their base to be adjusted annually so that it matches 70% of the federal minimum wage.
CNNMoney January 15, 2014 -
Miller’s announcement isn’t entirely a shock, and many thought his decision to step down from the Steering and Policy Committee after the 2012 elections was an early indication he was eying the door even then. But several leadership aides pushed back against that notion Monday, arguing Miller’s close relationship with Pelosi meant he simply didn’t need the chairmanship of that panel to exert his influence.
“He’s always involved in what he wants to be involved in anyways — he always has her ear — so I just think he felt like he didn’t need it,” the current leadership aide said.
Few on Capitol Hill have fought harder than Miller for liberal priorities like workers rights, the environment and universal healthcare.
As then-chairman of the House Education and the Workforce Committee, Miller was instrumental in passing much of the Democrats’ 2010 healthcare reform law, the Lilly Ledbetter Fair Pay Act, the 2009 federal stimulus bill and a number of pieces of labor and environmental protection legislation. When a garment factory collapsed in Bangladesh last year, killing more than 1,100 workers who produced clothing for popular western labels, Miller was on the front lines of the push to install better worker safeguards, an effort that included an extended visit to the site of the accident.
He’s also been among the loudest proponents of increasing the minimum wage, a fight he’ll continue Tuesday with economists of the Economic Policy Institute.
The Hill January 15, 2014 -
“The vast majority of employees who would benefit are adults in working families, disproportionately women, who work at least 20 hours a week and depend on these earnings to make ends meet,” the letter said. “At a time when persistent high unemployment is putting enormous downward pressure on wages, such a minimum-wage increase would provide a much-needed boost to the earnings of low-wage workers.”
The letter, released by the Economic Policy Institute, was signed by leading economists from across the United States, including seven Nobel laureates. UCLA economist Raul Hinojosa-Ojeda was among those endorsing the proposal.
A Democratic-backed proposal to raise the minimum wage to $10.10 is stalled in Congress. Last year, California Gov. Jerry Brown signed a law that will raise California’s minimum wage to $10 by 2016.
Los Angeles Times January 15, 2014 -
A large swath of economists agree, raising the minimum wage is a good idea.
In a letter released Tuesday through the Economic Policy Institute, a left-leaning think tank, 75 economists, including seven Nobel Laureates, argue that the government should hike the federal minimum wage from $7.25 to $10.10 an hour by 2016 and then peg future increases to inflation. A proposal from Senate Democrats, backed by President Obama, to raise the minimum wage to $10.10 an hour is currently stalled in Congress.
“At a time when persistent high unemployment is putting enormous downward pressure on wages, such a minimum-wage increase would provide a much-needed boost to the earnings of low-wage workers,” the letter reads.
The Huffington Post January 15, 2014 -
Seven recipients of the Nobel Prize in Economic Sciences were among 75 economists endorsing an increase in the minimum wage for U.S. workers.
In a letter released today, the group called for the hourly minimum wage to reach $10.10 by 2016 from its current $7.25, and then be indexed for inflation thereafter. They said “the weight” of economic research shows higher pay doesn’t lead to fewer jobs.
Bloomberg January 15, 2014 -
Not only are we now faced with slower growth, but that lesser growth rate is much more narrowly distributed (for broader historical reference: the real annualized G.D.P. growth rate over the full 1960s cycle was 4.5 percent versus 2.6 percent over the 2000s cycle). We’re baking a smaller economic pie and cutting less equal slices. As underscored by the simple Danziger exercise, at any level of G.D.P. growth there would be less poverty reduction because of the inequality wedge. But we’ve also got less growth to boot.
One last chart. In my War on Poverty post, I referred to the chart below by the Economic Policy Institute, which quantifies the contributions of many of the factors driving poverty trends. Actually, it’s the institute’s adaptation of an earlier methodology introduced by Professor Danziger and the economist Peter Gottschalk. Of the factors they look at, they find that rising inequality is quantitatively the largest, including overall growth, family structure, education and race.
New York Times January 15, 2014