A Bloomberg editorial points out that after adjusting for the cost of living, the purchasing power of the minimum wage is lower than it was in 1968. Conservatives insist that raising it loses jobs (it doesn't) or it raises the cost of goods.(It
A Bloomberg editorial points out that after adjusting for the cost of living, the purchasing power of the minimum wage is lower than it was in 1968. Conservatives insist that raising it loses jobs (it doesn't) or it raises the cost of goods.(It doesn't.) It not only doesn't do those things, it provides a small economic boost. But you know, for some reason, "job producers" intensely dislike the idea of sharing the wealth with the people who work for them:
Here’s an unhappy observation about the minimum wage: Congress last increased the rate in stages in 2006, topping it out at $7.25 an hour in 2009, or $15,080 a year.
That amount, when adjusted for inflation, is actually lower than what a minimum-wage worker earned in 1968 and is too meager to offer anyone the chance to climb out of poverty, let alone afford basic goods and services.
About 10 states are now considering raising the rate, and Senator Tom Harkin, an Iowa Democrat, is proposing to increase the federal rate in three increments to $9.80 an hour in 2014. Many of the initiatives under consideration would smartly tie the minimum wage to the cost of living, meaning that those workers’ wages would finally keep up with inflation.
The past recession was brutal on jobs, household wealth and economic growth. But wages were hit hard, too. Real average hourly earnings have fallen below the level of 2009. Although wages often lag job growth after a recession, the pace of income gains this time around is far slower than in previous recoveries.
It’s also becoming clear that many Americans are being forced to take lower-paying jobs and that a low-wage bias is creeping into the economy, as Bloomberg economist Joseph Brusuelas recently put it. In many cases, minimum-wage work is all that’s available, which may explain why such workers are older and better-educated than they were three decades ago. In 2010, nearly 44 percent of minimum-wage workers had either attended or graduated from college, up from 25.2 percent in 1979, according to the Center for Economic and Policy Research, a liberal think tank.
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