What would you do if you had to carve out a living on a minimum wage job?
Most people never consider the question.
Every time the issue of raising the minimum wage comes up, politicians and business people argue the idea down.
"Jobs will be lost."
"Business won't be able to pay and people will be laid off."
"Raising the minimum wage simply drives up costs of consumable goods and services, a fact that eventually makes life harder for minimum wage workers."
We need to look deeper.
First, the facts: the current minimum wage is $5.15 per hour.
A person earning minimum wage on a full-time, 40-hour-a-week job earns gross wages of $10,700 annually.
This amount is $5,000 below the federal poverty line for a family of three. It is over $8,000 below the line for a family of four.
Second, the erosion of the real value of the minimum wage (and all other wages for that matter!) over the past several decades has been dramatic. The purchasing power of the minimum wage adjusted for inflation is over $3.50 below what it was in 1968. To attain the purchasing power of 1968 dollars the minimum wage would need to rise to $8.70 per hour.
The hourly wage required to rent a two-bedroom apartment at fair market value here in Dallas, Texas is between $16 and $17 an hour.
If we raise the minimum wage to $7.25 an hour, as The Fair Minimum Wage Act of 2005 suggests be done over a two-year period, the results would be most helpful to low-income families.
The annual difference would amount to $4,368.
Over 15 million laborers in the United States would be positively affected by this change.
What would the gain mean in terms of real life impact?
Try this list:
Over a year of child care (if you can find a really good deal).
Tuition for a community college degree.
A year-and-a-half of heat and electricity.
Over a year of grocery purchases.
Eight months rent in a low-income neighborhood.
Propaganda to the contrary, evidence from past increases in the minimum wage reveals that such action does not have a negative impact on employment or inflation.
And, even with this sort of raise, our lowest wage workers will still face enormous challenges that must be worked through. A comprehensive package of other social and economic benefits need to be restored and enhanced for working people at the bottom, including health care, supplemental food and nutrition resources, housing subsidies, child care assistance, transportation and skills upgrading.
People who work hard in America should be able to make a life for themselves and their families.
Everyone understands the value of work.
What is needed now is action to properly value work in terms that matter. . .at the bank and in the pockets of the poor.
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