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Monday, January 15, 2007

Higher Minimum Wage Would Help 13 Million U.S. Workers

Since 1997, the federal minimum wage has been stuck at $5.15. A bill moving through the new Congress would raise the minimum wage to $7.25—an increase that is long overdue, according to the left-leaning Center for American Progress, a Washington think tank.

This minimum wage increase would boost earnings for 13 million American workers—9.8 percent of the workforce, the think tank says.

The U.S. House of Representatives passed a federal minimum wage increase, and now it is up to the U.S. Senate to consider the bill.

• Twelve million adult wage-earners, 80 percent of the minimum wage-earning population, will directly benefit from a minimum wage increase.
• Seven million families with children—46 percent of the total low wage-earning families with children—currently receive all of their earnings from minimum wage jobs.
• Nine million women (59 percent of minimum wage earners) and six million people of color (40 percent of minimum wage earners) will directly benefit from a minimum wage increase.
• Raising the minimum wage will increase annual earnings to $15,000 from $10,700. Without this increase, a family of three supported by one minimum wage earner will live roughly $5,400 below the federal poverty line.
• At the 350 largest public companies, the average CEO total direct compensation was $11.6 million in 2005. At this rate of compensation, it takes the average CEO only one hour and 55 minutes to earn the annual pay of a minimum wage worker.

The minimum wage increase will not harm our economy, the think tank says:

• The minimum wage increase will not cause price inflation. In Arizona, for example, the total cost of the wage increases is equal to 0.08 percent of total sales. The average business can fully cover the cost of the minimum wage by increasing revenue by less than 0.1 percent.
• The minimum wage increase will not destroy job growth. Between 1997 and 2003, small business employment increased by 9.4 percent in higher minimum wage states, compared to 6.6 percent in states at the federal level.
• The minimum wage increase will not shut down small businesses. Between 1998 and 2003, the number of small businesses increased by 5.5 percent in higher minimum wage states, compared to 4.2 percent in states at the federal minimum wage level.

Raising the minimum wage is a progressive issue that resonates with the American public and bridges the partisan divide, the center adds.

• A 2006 opinion poll found that 83 percent of Americans support an increase in the federal minimum wage.
• A decade of federal inaction has prompted 29 states (including D.C.) to raise the minimum wage above $5.15.
• The minimum wage is an opportunity for bipartisanship. In 2006, the governors and state legislatures of California, Michigan, and Pennsylvania worked across party lines to raise the minimum wage.
• In 2006, the minimum wage ballot initiatives had a “6-0” winning record in six states that voted for President Bush in 2000 and 2004. The minimum wage presents an issue that can unite, rather than divide, America.

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