Bruce Murphy
Murphy’s Law

$15 Minimum Wage Would Help 831,000 State Workers

38% of Milwaukee workers would benefit from minimum wage hike, versus 22% nationally.

By - Feb 22nd, 2021 03:55 pm
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The federal minimum wage is just $7.25 and has not increased since 2009. And while the majority of states have increased their minimum wage to a level above that, Wisconsin has declined to do that, leaving its lowest paid workers to fall ever further behind, and increasing the state’s wealth gap.

A new study shows the proposal to raise the federal minimum to $15, which Democrats in Congress are pushing for, would have a massive impact on the nation. It would increase the pay for more than 33 million workers in the nation or 22.2 percent of the U.S. workforce, the study by the liberal Economic Policy Institute (EPI) found. “The increases would provide an additional $92 billion in wages for the country’s lowest-paid workers, with the average affected worker who works year-round receiving an extra $2,800 a year,” the study noted. This would raise 6.2 million people out of poverty, the EPI has estimated.

To dramatize the impact, its latest study calculated the impact for each congressional district, using data from the Census Bureau, Bureau of Labor Statistics, and Congressional Budget Office. It shows a big impact for Wisconsin’s 4th Congressional District, represented by Democrat Gwen Moore, and which includes most of Milwaukee County. Compared to 22% of workers affected nationally by a $15 minimum wage, it would affect 38% of all workers — 130,000 employees — in Moore’s district. These 130,000 workers would earn an average additional wage of $3,400 per year, a combined increase $437 million in annual wages.

No congressional district in the state would see as great an impact on their workers. Second to the Milwaukee area would he the 3rd Congressional District represented by Democrat, Ron Kind, and including much of western Wisconsin, including Eau Claire and LaCrosse. In that district a $15 minimum wage would hike earnings for 32% of all workers — 111,000 employees — who would earn an average additional wage of $3,000 per year.

The area of the state that would be least affected is the 5th Congressional District, represented by Republican Scott Fitzgerald, which includes most of Waukesha, Washington, Dodge and Jefferson counties. Even so, the $15 minimum wage would increase the earnings of 24% of all workers — 88,000 employees — who would earn an average additional annual wage of $2,900.

State-wide 831,000 workers would see their wages raised by a $15 minimum wage.

Because these are workers at the lowest end of the economy, increasing the minimum wage has a disproportion impact on women and minorities. Thus, while 38% of all workers in Moore’s Milwaukee-based district would be affected, 42% of working women, 49% of Black workers and 57% of Hispanic workers would see their wages increased. Raising all boats at the bottom has a built-in benefit of greater gender, racial and ethnic equity.

[inarticle_email_signup}Across the nation, 29 states and the District of Columbia have increased their minimum wage to a level higher than the federal minimum, according to a report by the National Conference of State Legislatures. The higher minimum in those states ranges anywhere from $8.75 to $15.00. In Wisconsin Republican-dominated Legislature, led for years in the Senate by former Majority Leader Fitzgerald, have repeatedly refused calls to increase the minimum wage. Gov. Tony Evers has included a $15 minimum wage in his new budget proposal, but Republicans are expected to oppose this.

The Congressional Budget Office has estimated that a $15 minimum wage would cost 1.4 million jobs, as employers cut jobs to absorb the cost of higher wages. But as Urban Milwaukee’s Data Wonk has reported, numerous studies comparing states and counties that do or don’t increase the minimum wage have found little impact on total employment even as the higher wage has benefits in terms of raising people out of poverty and increasing purchasing power and consumer spending.

The stagnation of wages at the bottom end of the nation’s workforce has contributed greatly to the wealth gap in America. Had the minimum wage increased at the same rate as CEO salaries it would now be at least $40 an hour.

Democrats are currently in disagreement as to whether to include a $15 minimum wage as part of President Joe Biden‘s $1.9 trillion pandemic aid package. Leading the push to include it is Democratic Senator Bernie Sanders.

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