States Aim to Up the Minimum Wage

A bill to raise the federal minimum wage for the first time in nine years failed in the Senate last week. But in a number of states, fall ballot measures would raise the minimum wage above the federal level. Would low-wage workers be helped or harmed if these measures pass? Economists are divided.

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Minimum wage workers won't be getting an automatic pay raise any time soon. A measure that would have increased the federal minimum wage by $2.10 an hour died in the Senate last week when Democrats objected to a companion measure that would have cut the estate tax for the wealthiest Americans. But minimum wage supporters aren't giving up. They now turn to ballot measures in half a dozen states that would boost low hourly wages.

NPR's Scott Horsley reports.

SCOTT HORSLEY reporting:

The minimum wage bill that failed in the Senate last week would have given a pay raise to about six and a half million Americans. Jean Gaines(ph) is one of them. The 22-year-old Cincinnati woman works about 32 hours a week, washing dishes and running the cash register at a take-out restaurant. She makes $5.50 an hour, just 35 cents above the current federal minimum. Much of her paycheck goes for rent on the apartment she shares with her mother, her younger brother, and her four-year-old daughter.

Ms. JEAN GAINES (Restaurant Worker, Cincinnati, Ohio): It's hard being a single parent and raising kids. You know, I had to pay rent, pay my furniture bill, and it basically broke me when I got my check. You know, I only had 40 to $50 to myself just to work with. And it was pretty hard.

HORSLEY: Gaines recently had to return a rented sofa when she couldn't keep up with the weekly payments. She's thinking about going back to school, which she quit after the ninth grade. She thinks a better job or at least a bigger paycheck would help to make ends meet

MS. GAINES: Minimum wage right now, 2006, seems like you just working for nothing. You might as well sit on your butt, you know, wait for the welfare to give you something. So they need to raise it up, just a little bit, for us to have the things we need. Sometimes you can't get your wants, but at least be able to pay our rent and not have to stretch, be able to pay our electric bill and not have to stretch. This is things that we need. So they do need to raise it up. And I don't know what they waiting for.

HORSLEY: About half the states already require a higher minimum wage than the federal government does. Ohio, where Gaines lives, could join that group with a ballot measure this fall that seeks to raise the state's minimum to $6.85 an hour. Kristina Wilfore, of the labor-backed Ballot Initiative Strategy Center, says similar measures are likely in five other states.

Ms. KRISTINA WILFORE (Ballot Initiative Strategy Center): The states figured out a long time ago they couldn't sit around and wait for Congress to finally move on this.

HORSLEY: Some Democrats see the minimum wage ballot measures as a way to mobilize liberal voters, much as efforts to ban same-sex marriage helped turn out conservatives. But a survey by the Wall Street Journal and NBC found broad bipartisan support for raising the minimum wage. Wilfore says the measures are a genuine effort to help the nation's poorest workers.

Ms. WILFORE: There is a political component here. We know that ballot measures have an ability to define and distinguish candidates, and turn out pockets of voters and do something more than just change laws. But this is not a gimmick.

HORSLEY: Economists have traditionally argued that any increase in the minimum wage comes at a price. Some workers may get fewer hours; others may not be hired at all. Economist David Neumark, of the University of California at Irvine, says those costs tend to fall hardest on workers with the worst job prospects anyway.

Mr. DAVID NEUMARK (University of California, Irvine): Young, unskilled, minority, anyone whose wage is near the minimum, they're the ones who are likely to be affected. Now, they're not all going to be hurt by any means, right? Many will keep their jobs and get a raise, and they're sort of the winners. Some will have worse employment prospects, have their hours reduced, maybe lose their job, and they're the losers. Now, the cost to the loser is probably a lot bigger than the gain to a winner.

HORSLEY: But economist Jared Bernstein, of the Economic Policy Institute in Washington, says those costs are overblown. He says there's little evidence that the last minimum wage hike nine years ago hurt the job market for low-wage workers. Since that time, though, inflation has eaten away at the increase, and the buying power of the minimum wage is now at its lowest level in 50 years. Bernstein says it's time for policy makers to take a stand in defense of low-wage workers.

Mr. JARED BERNSTEIN (Economic Policy Institute): The minimum wage isn't part of social policy. The idea here is that you're not going to let the market jam wages down to 25 cents an hour, or whatever, if that's what supply and demand dictates.

HORSLEY: In Las Cruces, New Mexico, college student Joe Pilowski(ph) and his wife both make close to minimum wage. He says they'd welcome an increase, because the $5.15 he makes in a bookstore doesn't go very far.

Mr. JOE PILOWSKI (College Student): You know, it gets tight, and that stress, you know, it's not very fun. You know, counting pennies, and you go to Wal-Mart and you're trying to buy toothpaste with a handful of change, stuff like that. I mean, it builds character, but, you know, having a little bit extra would definitely help.

HORSLEY: For now though, Pilowski can look forward to more character building, and not any more money in his paycheck.

Scott Horsley, NPR News.

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