1. Minimum Wage Policies
in the United States
Karen Trietsch, MSSW Candidate
University of Texas at Austin – School of Social Work

2. History
 Movement began in 1908 with National Consumers League
 protested sweatshop conditions for women
 First laws were passed in states, often overturned by SCOTUS
 “protective legislation” – for women only
 opposed by unions
 Great Depression, FDR, and Frances Perkins
 1933 National Industrial Recovery Act – struck down by SCOTUS in 1935
 1938 Fair Labor Standards Act (limited coverage, most women’s occupations not included)
 Since then, minimum wage has been raised by every president except Ronald Reagan and Barack
Obama
 Peak purchasing power: 1968 - $1.60 would be worth $10.69 in 2014
 Cities began increases in 1994

3. $10.56 in 2012 = $10.69 in 2014
(Congressional Research Service, http://fas.org/sgp/crs/misc/R42973.pdf)

4. States with higher minimum wages
Pew Research Center, 5/20/15
http://www.pewresearch.org/fact-
tank/2015/05/20/5-facts-about-the-minimum-
wage/

5. State minimum wage rates
 29 states and Washington D.C. have m.w. laws higher than federal level
 23 raised their minimum wage in 2014
 4 states were passed by voters
o AK, AR, NE, SD – all predominantly red
 2 states have m.w. lower than federal level
o GA, WY
 5 states have no m.w. law
o AL, LA, MS, SC, TN

6. States with higher minimum wage rates
 Highest right now is WA = $9.47
 Lowest higher amount is $7.50 = AR, ME, NM
 Other upcoming increases
 7/1/15 – DC = $10.50  7/1/16 = $11.50
 1/1/16 – CA = $10.00
 1/1/18 – VT = $10.50
 16 states adjusted annually for CPI or Cost of Living
 Also DC

7. City/local minimum wage rates
 Over 120 cities have a higher minimum wage
 First cities to raise m.w.
o 1994 – Baltimore, living wage for companies with municipal contracts or subsidies
o 2003 – San Francisco – $8.50, $15.00 in 2015
o 2003 – Santa Fe - $10.66 now
 10 cities raised m.w. 2012-2013
o 2013 – Sea-Tac = $15.00
 Cities that raised m.w. in 2014 - 2015
o San Diego (challenged), Oakland, Berkeley, Las Cruces (NM), D.C.
o Seattle - $15 in 2018-2021, depending on size of business, sub-minimum for teens
o Chicago - $13 by 2019
 Los Angeles increases:
o 2014 - Non-teaching school service emp. - $15
o 2014 - Hotel workers - $15.37
o 2015 - Raised city-wide in May 2015 – $9.00  $15 by 2020

8. Proposed city increases
 Oakland - $12.25
 Chicago
 city council calling for $15, supported by
Mayor Emmanuel
 New York City - $15.00
 Supported by DiBlasio, would require new
state law
 Cuomo wants $11.50 in NYC and $10.50 in NY
state
 DC wants $15

9. State laws banning local increases
 Texas – 2003 = HB 804
o started in response to Houston ballot initiative
supporters said it would create level playing field for
businesses in multiple cites throughout the state & it
would halt the living wage movement “before it
becomes a serious threat in Texas”
 6 other states passed it in 2003-2004
o CO, FL, GA, LA, NY, OR
 Oklahoma passed it in April 2014

10. Demographics - 2014
 16-19 y.o. 21.4%
 16-24 y.o. 48.2%
 25+ y.o. 51.8%
 Men 37.2%
 Women 62.8%
 Women 25+ 33.7%
 H.S. grad or more 77.0%
 Source: US Bureau of Labor Statistics, April 2015
 White 76.3%
 Black 15.4%
 Hispanic 17.3%
 Full time 34.5%
 Part time 65.3%
 Texas 12.1%
 Florida 6.1%
 New York 4.6%

11. Minimum Wage Demographics 2014
Gender
Men
Women
Age
16-19 19-24 25 +

12. Arguments Opposing Minimum Wage
 Ineffective anti-poverty measure
 Negative effect on employment
 Free market ideology
 Causes inflation
 Increases immigration

13. Arguments Supporting Minimum Wage
 Morality & social egalitarianism, esp. poverty level of workers
 From 1950 – 1997, unemployment went up as often as it went down after federal
increases (8 & 8)
 Stimulates the economy as workers have more money to spend
 Increases job growth (46,400 jobs projected in LA region)
 Increases tax revenue to federal, state, and local governments
 Reduces public assistance expenditures
 Reduces economic inequality between gender, and whites and people of color
 62% - 73% of the public support increasing the federal minimum wage

14. Minimum Wage and Worker Productivity
 Productivity increased about 243% from 1948 to 2012.
 If minimum wage had kept pace with worker productivity, it would have been $21.72 in 2012.
 (Center for Economic and Policy Research)

15. Source: Doug Short, http://wolfstreet.com/2014/11/13/corporate-profit-margins-vs-employee-compensation-in-one-disturbing-chart/

16. Minimum Wage and Poverty
 Effects of increases on income
 2015 poverty level is $15,930 for a family of two (US DHHS)
 $7.25 = $15,080 annual full-time minimum wage earnings (CPPP)
 $850 below poverty level for family of two
 $10.10 = $21,008 for 2080 hours annually = + $5,928
 $15.00 = $31,200 for 2080 hours annually = + $16,120
 22% of U.S. children live in poverty, 25% of Texas children
 Most of these children have parents who work
 Texas is 38th in child poverty rates, 43rd in children’s overall well-being

17. Public cost of low wages
 Public assistance to workers costs taxpayers $152.8 billion a year
 UC Berkeley Center for Labor Research & Education, April 2015 report
 Studied cost of aid to working families
 Studied Medicaid, CHIP, SNAP, TANF, and EITC
 73% of families enrolled in public support are working families
 $2.69 billion in Texas (ranks 3rd behind CA & NY)