MINIMuM WAge INcreAse: NW Is Te TIMe
It is oten said by those who oppose increases to the minimumwage that most low-wage earners are teenagers or unskilledworkers who do not have the work experience that would enablethem to bargain or a higher wage. The abundance o data that hasbeen collected on the minimum wage and its aected populationshow that these assertions are alse.Currently, in New York State, there are approximately 925,700workers earning less than $9.00 per hour, which accounts or justover ten percent o the state’s employed population.
The mostsignicant evidence against the assumption that most low wageearners are either teenagers or unskilled is the act that according torecently published data, 84 percent o those that would be directlyaected by an increase in the state’s minimum wage are adults; andurther still, 87 percent o those aected work more than 20 hoursper week.
Nationally, women, Arican-Americans and Hispanicsare disproportionately represented among low-wage earners, withwomen representing about two-thirds o the minimum wage earningpopulation and sixty-one percent o the ull-time minimum wageearners.
Opponents o increasing the minimum wage have also argued thatthis proposal would have crippling eects on the business climateand lead to higher rates o unemployment in New York State.Traditionally, the basis or this position has been the theory thatincreased wage costs will reduce demand or labor and thereore,result in disemployment. This argument represents an oversimpliedview o a complex economic relationship and also ails to takeinto account the myriad o actors involved in the determination ounemployment rates. It assumes that all businesses and employers,regardless o size or sector, experience the same reaction toeconomic conditions. Over the years, labor market research andacademic studies have consistently concluded that there is nodiscernible correlation between minimum wage increases and job loss or business ailures.
In act, Chart 1
shows that ater thelargest increase in the minimum wage in the past decade – 0.85cents in January 2005 – the unemployment rate went down; andit went down again ater the next increase. It is widely acceptedthat other trends, among them: limited sector job availability whichtargets specialized skills; changes to the labor orce causedby worker choices relating to educational pursuits, retirement,
“aodin to ntlypblihd data, 84pnt of tho thatwold b ditlyafftd by an inain th tat’ minimmwa a adlt; andfth till, 87 pntof tho afftdwok mo than 20ho p wk.
Nationally, womn,Afian-Amianand ipani adipopotionatlypntd amonlow-wa an, withwomn pntinabot two-thid ofth minimm waanin poplation andixty-on pnt of thfll-tim minimm waan.
”“aft th lat inain th minimm wa inth pat dad – 0.85nt in Janay 2005 –th nmploymnt atwnt down”
Fiscal Policy Institute. “Which workers will benet, i the New York minimum wage is raised to $8.50 an hour?” February 2012, available at http://scalpolicy.org/wp-content/ uploads/2012/04/FPI_NumbersThatCount_BenetsOIncreasingTheMinimumWage.pd
Fiscal Policy Institute and National Employment Law Project. “Raising New York’s Minimum Wage: The Economic Benets and Demographic Impact o Increasing New York’sMinimum Wage to $8.75 per Hour.” January 2013, available at http://scalpolicy.org/wp-content/uploads/2013/01/Raising-New_york-Min-Wage-FPI-NELP.pd
Bureau o Labor Statistics, Characteristics o Minimum Wage Workers, 2011, available at http://www.bls.gov/cps/minwage2011tbls.htm#1
Jared Berstein, Economic Policy Institute, “Minimum Wage and its Eect on Small Business” 2004, available at http://www.epi.org/publication/webeatures_viewpoints_raising_minimum_wage_2004/ (citing Jerold Waltman, Allan McBridge, and Nicole Camhout, “Minimum Wage Increases and the Business Failure Rate,” Journal o Economic Issues,Vol. XXXII, No. 1, March 1998)