I recall writing, maybe 10 years or so ago, something about the minimum wage not being sufficient -- even for full-time workers -- to pay the bills of an average person. Even an average person who's tight with a dime and even tighter with a dollar.
I don't even recall what the minimum wage might have been back then -- for some reason $5.15 an hour comes to mind -- but whatever it was, it wasn't enough.
Then in 2007, the minimum wage went up 70 cents an hour to $5.85. And then another 70 cents the next year, and another 70 cents the year after that, so that by 2009 the minimum wage sat at $7.25 an hour.
Which is where it sits right now.
I also recall writing all those years ago that increasing the minimum wage was only going to cost jobs and add to the cost of goods and services, which would only be passed on to the consumer anyway.
I think time has proved that I was wrong about the minimum wage increases having cost a lot of jobs -- some perhaps, though not a lot -- but I was probably correct about the cost of minimum wage adjustments being dumped on consumers.
The same consumers, I might suggest, who received the increase in minimum wage to begin with. So in essence, the workers who could least afford it ended up paying for their own wage increases.
In terms of buying power, they weren't much better off with the increases than they were before.
The truth is the minimum wage saw its high water mark in 1968, when it was $1.60 an hour, but its value in today's dollars (adjusted for inflation) was $10.55 an hour. Go figure.
It's the old rock-and-hard-place debate. On one hand, we know the minimum wage is not a living wage. Do the math: 40 hours of work times $7.25 equals a paltry $290 a week (before taxes). Times 52 weeks? Well, that equals $15,080 a year.
I might suggest it's rough sailing trying to get by on $15,080 a year, particularly if you have children and don't live with your parents.
On the other hand, we also know that increasing the minimum wage only adds to the cost of goods and services because most businesses are not going to absorb the cost.
What to do? What to do?
Well, I received an email on Monday from a pro-business organization that has a solution it thinks it can live with.
The Business for Shared Prosperity, "a national network of forward-thinking business owners, executives and investors" (according to its own website), believes it's time to increase the federal minimum wage again.
Now keep in mind the country is at $7.25 an hour, except in those states -- California, Oregon, Washington, Alaska, Arizona, Nevada, New Mexico, Colorado, Montana, Florida, Ohio, Michigan, Illinois, Connecticut, Rhode Island, Massachusetts, Vermont, Maine and Washington, D.C. -- with a minimum wage higher than the federal number.
In Washington State, for example, workers earn a minimum of $9.04 an hour. The higher standard always applies.
Anyway, I'm reading this email, and I'm thinking how unusual and surprising it is for business owners to be promoting an increase in the minimum wage. Their reason? Well, they're saying they think an increase "would be good for business and the economy."
As you read this, there are proposals sitting in Congress to raise the minimum wage to $9.80 by 2014. That's a jump of $2.55 an hour in three steps -- roughly 82 cents at a time. Again, do the math -- $9.80 an hour times 40 hours equals $392 a week (before taxes), which leaves an annual income of $20,384 (before taxes).
Better? To be sure. But still not a living wage. It barely exceeds the federal poverty line for a family of three.
But that's what this organization of business owners is pushing. They think it makes good business sense. They think it'll help them keep qualified employees. They think it'll foster company loyalty. They think it'll be more money in the hands of consumers, who in turn will spend it on goods and services. They think it's right and fair and will help stimulate the national economy.
Hey, maybe they're on to something.
But if they are right and their motivation is as pure as they say it is, then why don't they just go ahead and start paying all their employees the higher wage? Why wait for Congress to grease the skids? Why wait for the federal government to get involved at all?
Starting tomorrow, they could just start paying all their employees $9.80 an hour. That'd put a lot of smiles on a lot of faces.
In fact, if a simple wage increase is the answer to all their problems -- as they seem to suggest -- why not just start paying everyone $15 an hour. Better yet, $20.
What's stopping them?
It makes a body wonder.
Columns by Larry A. Hicks, Dispatch columnist, run Mondays, Wednesdays and Fridays. E-mail: lhicks@yorkdispatch.com.



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