Thursday, April 27, 2017
41 Million Americans Await a Long Overdue Pay Boost
If $7.25 doesn’t seem like much, it’s because it isn’t.
It is, in fact, barely enough to buy a Big Mac and a drink at McDonald’s, where the hourly wage averages barely $8.50 an hour.
Yet Idaho’s minimum wage, last adjusted in 2008, has been stuck at $7.25 an hour for seven years, matching the federal minimum wage, and legislators both here and in Washington have done nothing. Nothing in Idaho means nothing – zilch, nada, zero -- to the point of not even having the prospect of a modest increase brought up for discussion in the last legislative session. That means nothing, despite the fact the buying power of a minimum-wage paycheck has actually fallen about 10 percent because of inflation, and this erosion doesn’t account for even half the decline in value that has taken place since the late 1960s, and despite the reality of an economy much richer, better educated, and more productive on average. There is nowhere in the United States that people can afford to live on minimum wage. The bottom line is minimum-wage workers receive about 25 percent less in spending power than their counterparts of a half-century ago.
That hourly wage of $7.25 looks even worse as an annual wage of $15,080 a year, or a weekly budget of $240 to buy basic food, shelter, and clothing, plus transportation. In Idaho, the minimum wage is applicable to employers of four or more employees, excluding family members. Employees under 20 years old can be paid $4.25 an hour for up to 90 days, and children under 16 working part-time jobs are fully exempt from any pay standard. About 30 percent of minimum wage workers are single parents. The average age of a person on minimum wage is 35. Moreover, 88 percent of people on minimum wage are over the age of 20. These aren't just teenagers who still live at home -- these are adults working full-time who ought to be able to afford housing.
There are new signs this could change. As LeeAnn Hall, co-director of People’s Action Institute, a United Vision for Idaho national partner, said in support of legislation to raise the minimum wage to $15 by 2024, “Our research shows that a $15 an hour minimum wage is a modest demand – the minimum wage in every state falls far short of an actual living wage. In Alabama, the $7.25 minimum wage is 47 percent of the $15.49 needed to make ends meet. In California, the $10 minimum wage is just half of the $19.90 it takes for a single adult to get by.”
Making matters worse, the minimal minimum wage is also a significant factor in pay disparity, placing Idaho eighth-worst in the nation. A recent study of data from the U.S. Census Bureau, the Department of Education, and the Bureau of Labor Statistics by the American Association of University Women found the average white woman in Idaho makes 74 percent of male earnings in comparable jobs. The gap is wider for black women, paid 63 cents, and Hispanic women, paid 54 cents, for every dollar paid to white, non-Hispanic men in the same jobs.
Senator Bernie Sanders (I-VT), Sen. Minority Leader Chuck Schumer (D-NY), Sen. Patty Murray (D-WA), Rep. Keith Ellison (D-MN), and Rep. Bobby Scott (D-VA) announce a new effort to raise the federal minimum wage to $15 an hour.
With a majority of Senate Democrats now behind them, Sen. Bernie Sanders (I-Vt.) and Sen. Patty Murray (D-Wa.) are introducing revamped legislation to raise the minimum wage to $15 and index it to inflation.The Raise the Wage Act of 2017 would raise the federal minimum for the first time in a decade, to $9.25 immediately, rising gradually to $15 by 2024, while simultaneously raising the minimum wage for tipped workers.
Since the Fight for $15 action campaign was begun in 2012 by striking fast-food workers, three states representing approximately 18 percent of the U.S. workforce—California, New York, and the District of Columbia — have approved raising their minimum wages to $15 an hour, and other states, including Washington, Oregon, Colorado, Arizona, and Maine, have approved minimum wages ranging from $12 to $14.75 an hour. In fact, raising the minimum wage was a significant issue in the 2016 election, with local ballot support for increases bringing to 19 million the total number of workers receiving minimum wage increases, and adding to momentum for further action at the federal, state and local levels.
David Cooper, senior policy analyst for the Economic Policy Institute outlined the impact of the Raise the Wage Act of 2017, which would gradually raise the federal minimum wage to $15 by 2024, link it to changes in the median wage thereafter, and gradually eliminate the separate, lower minimum wage for tipped workers.
“Targeting $15 by 2024 is a bold proposal, but it is absolutely necessary—otherwise the minimum wage will never provide a decent wage and overcome the many decades where it rose modestly or not at all.” said EPI President Lawrence Mishel. “Raising the minimum wage to $15 will directly help nearly a third of the workforce, promote robust wage growth, and boost the economy.”
“The proposal would directly lift the wages of 22.5 million workers. On average, these low-wage workers would receive a $3.10 increase in their hourly wage, in today’s dollars. For a directly affected worker who works all year, this equals a $5,100 increase in annual wage income, a raise of 31.3 percent. Meanwhile, another 19.0 million workers earning more than $15 would also see their wages increase from a spillover impact as employers adjusted their pay scales to the increase. A total of 41.5 million workers would benefit from this proposal, 29.2 percent of the wage and salary workforce.
The Washington Post report on introduction of the Raise the Wage Act is here.
Newsweek’s report on Sen. Sanders’ new wage-hike bill is here.
Bureau of Labor Statistics data on minimum wage workers in Idaho is here.
Data that shows nobody can live anywhere in the United States on the minimum wage are here.
A Spokesman-Review report on wage disparity in Idaho and the nation is here.
The Peoples Action statement on raising the minimum wage is here.
The Raise the Wage Act explanation from Sen. Bernie Sanders, in PDF format, is here.
The Economic Policy Institute’s paper on the wage increase is here.
The National Employment Law Project report on support for wage initiatives in the 2016 election is here.
The Portland Press Herald report, from the Washington Post, on inability to pay for housing on the minimum wage is here.
Data from the National Low-Income Housing Coalition are here.
The 2017 Big Mac Index is here.
Highlights of the current minimum wage law coverage in Idaho and other states are here.
Posted by Ron Rhodes at 2:50 PM
Tuesday, April 11, 2017
Idaho Gov. Butch Otter Tuesday vetoed a bill to repeal the state’s 6 percent sales tax, following through on a threat he had made when the proposal first emerged. His action, just within the deadline for such action, will leave Idaho among just 13 states that impose a tax on groceries.
In a letter to Secretary of State Lawerence Denny, Otter gave the need for a reliable source of revenue as his primary reason for refusing to support eliminating the tax. Removing the sales tax would take more than $201 million from state revenues in fiscal 2019, Otter asserted.
Also on Tuesday, the governor allowed a $315 million transportation infrastructure bill to become law without his signature. He noted that approval of the grocery tax repeal would mean education funding for K-12 programs would have to compete with highway projects for scarcer funds.
Otter pointed out that the grocery tax would take $80 million out of the general fund in 2018-19, and said the infrastructure bill would pit highway projects against K-12 funding. The repeal bill, approved widely in both legislative chambers, came March 27 a surprise amendment to a proposed $52 million tax-reduction bill in the House of Representatives. In addition to strong public support, grocery tax repeal had the backing of Lt. Gov. Brad Little, a declared candidate to succeed Otter in 2018, and Russ Fulcher, a former state senator who is also running.
The Idaho State Journal report on Otter’s veto is here.
The Statesman report on the grocery tax bill is here.
The Spokesman-Review report on the grocery tax bill is here.
Posted by Ron Rhodes at 1:48 PM