January 30, 2021 at 2:47 a.m.
Back off on minimum wage jump
Editorial
Employees need help.
Businesses need help.
State and local governments need help.
Given that, there’s a lot of good that could come out of Congress passing President Joe Biden’s coronavirus relief plan.
But the proposal of increasing the federal minimum wage to $15 should be pulled from the bill or significantly modified.
There is no question the federal minimum wage needs to be increased. After all, it has been at $7.25 since 2009. That’s far too long at the same level.
But a push to $15, either immediately or even over the course of the entirety of Biden’s term, would be a mistake.
Part of the challenge is that minimum wages vary from state to state, meaning the impact of such an increase would be felt differently across the nation.
Washington, D.C., for instance, already has a minimum wage of $15. California’s is $13 or $14, depending on how many employees a business has. And some cities have minimum wages that are set at higher levels than their state.
On the other hand, 20 states have a minimum wage of $7.50 or less, meaning they would have to at least double their minimum wages to get to $15. That includes Indiana and Kentucky, which both match the federal minimum of $7.25. Illinois is highest in the region at $11, following by Michigan ($9.65) and Ohio ($8.80).
What would happen if states like Indiana and Kentucky were forced to more than double their minimum wages?
It seems likely that businesses and industries would have to drastically and quickly increase prices in order to keep up with payroll. Probably, jobs would have to be cut.
Those are changes no one wants.
Harry Holzer, a professor of public policy at Georgetown University, told NBC News he doesn’t expect the $15 minimum wage to pass.
“I’m guessing if a minimum wage does pass it might be more like $10 or $12 rather than $15, and it might be implemented slowly,” he said. “For lots of big cities and populous states that have already implemented it, it’s not a terrible idea. Those are high-wage, high-priced areas already. The problem is, in the states that have a lot of rural areas, $15 is not far below the region’s median. This risk that some of those jobs would disappear is higher there.”
He’s right.
If a $15 minimum wage is the goal, we’d suggest enacting a plan to increase it gradually, over time. Perhaps 50 cents a year would be viable. Even at that rate, it would take more than 16 years to get to $15.
(The real problem here is that no steps have been taken in more than a decade. The minimum wage should be increased slightly each year in order to avoid the need to make major leaps all at once.)
It’s a good idea to give individuals, businesses and states the help they need. We hope the latest round of coronavirus-related stimulus passes.
But a $15 minimum wage should not be a part of it. — R.C.
Businesses need help.
State and local governments need help.
Given that, there’s a lot of good that could come out of Congress passing President Joe Biden’s coronavirus relief plan.
But the proposal of increasing the federal minimum wage to $15 should be pulled from the bill or significantly modified.
There is no question the federal minimum wage needs to be increased. After all, it has been at $7.25 since 2009. That’s far too long at the same level.
But a push to $15, either immediately or even over the course of the entirety of Biden’s term, would be a mistake.
Part of the challenge is that minimum wages vary from state to state, meaning the impact of such an increase would be felt differently across the nation.
Washington, D.C., for instance, already has a minimum wage of $15. California’s is $13 or $14, depending on how many employees a business has. And some cities have minimum wages that are set at higher levels than their state.
On the other hand, 20 states have a minimum wage of $7.50 or less, meaning they would have to at least double their minimum wages to get to $15. That includes Indiana and Kentucky, which both match the federal minimum of $7.25. Illinois is highest in the region at $11, following by Michigan ($9.65) and Ohio ($8.80).
What would happen if states like Indiana and Kentucky were forced to more than double their minimum wages?
It seems likely that businesses and industries would have to drastically and quickly increase prices in order to keep up with payroll. Probably, jobs would have to be cut.
Those are changes no one wants.
Harry Holzer, a professor of public policy at Georgetown University, told NBC News he doesn’t expect the $15 minimum wage to pass.
“I’m guessing if a minimum wage does pass it might be more like $10 or $12 rather than $15, and it might be implemented slowly,” he said. “For lots of big cities and populous states that have already implemented it, it’s not a terrible idea. Those are high-wage, high-priced areas already. The problem is, in the states that have a lot of rural areas, $15 is not far below the region’s median. This risk that some of those jobs would disappear is higher there.”
He’s right.
If a $15 minimum wage is the goal, we’d suggest enacting a plan to increase it gradually, over time. Perhaps 50 cents a year would be viable. Even at that rate, it would take more than 16 years to get to $15.
(The real problem here is that no steps have been taken in more than a decade. The minimum wage should be increased slightly each year in order to avoid the need to make major leaps all at once.)
It’s a good idea to give individuals, businesses and states the help they need. We hope the latest round of coronavirus-related stimulus passes.
But a $15 minimum wage should not be a part of it. — R.C.
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