January 15, 2018
We’ve chronicled the consequences of a $15 minimum wage our website Faces of $15. Less than two weeks into 2018, the list of tragic stories keeps growing. With Ontario, Canada’s minimum wage rising to $14 an hour, franchisees of Canadian … Continue reading
December 28, 2017
The Trump administration’s tax overhaul prompted Wells Fargo and Fifth Third Bancorp to raise their minimum wages to $15 per hour. OceanFirst Financial Corp., a New Jersey bank, and three of the biggest banks in Hawaii—The Bank of Hawaii and … Continue reading
December 14, 2017
For the past two decades, California has pursued minimum wage levels about the federal standard. It will be the first state to reach a $15.00 per hour minimum wage, in 2022. A new study by Dr. David Macpherson of Trinity … Continue reading
About the Minimum Wage
The minimum wage is the minimum hourly wage an employer can pay an employee for work. Currently, the federal minimum wage is $7.25 an hour (part of the Fair Labor Standards Act) and some states and cities have raised their minimum wage even higher than that. Washington and Massachusetts currently have the highest state minimum wages in the country at $11 per hour, and Emeryville, CA, currently has the highest city minimum wage at $15.20 an hour.
Employees that earn the minimum wage tend to be young, and work in businesses that keep a few cents of each sales dollar after expenses. When the minimum wage goes up, these employers are forced to either pass costs on to consumers in the form of higher prices, or cut costs elsewhere–leading to less full-service and more customer self-service. As a result, fewer hours and jobs are available for less-skilled and less-experienced employees.
Minimum wage increases do not help reduce poverty. Award winning research looked at states that raised their minimum wage between 2003 and 2007 and found no evidence to suggest these higher minimum wages reduced poverty rates. While the few employees who earn a wage increase might benefit from a wage hike, those that lose their job are noticeably worse off.
Employees who start at the minimum wage aren’t stuck there. Research found that the majority of employees who start at the minimum wage, move to a higher wage in their first year on the job.