In 1960, George Lesauvage of the National Restaurant Association was making the case against increasing the federal minimum wage. “Wages, of course, in the restaurant industry are low for several reasons,” he said. “One of the most important is the fringe benefits that a restaurant worker gets in the form of free meals which in terms of value to the employee are most significant. Another fringe would be free uniforms.”
Wow, free uniforms. He forgot to mention free restrooms!
This quote echoes the sentiments we hear nowadays from those opposed to raising the minimum wage, which has been stuck at $7.25 an hour for the past three years. Tuesday actually marked the third anniversary of the last increase.
As John Schmitt at the Center on Economic Policy and Research notes, the value of the minimum wage, adjusted for inflation, has dropped by about 6% since the July 24, 2009 increase. That’s partly why a group of top economists is urging Congress to raise the minimum wage in three steps to $9.80 by 2014.
The economists estimate that this increase would benefit 29 million low-wage workers—20 million minimum wage earners directly and another 9 million who earn just above minimum wage and would likely see a boost. Most of those who would benefit would be “adults in working families,” for whom a boost in buying power would help the economic recovery.
Holly Skylar, director of Business for a Fair Minimum Wage, lays out the case for increasing the minimum wage, arguing that with the rising cost of living, minimum wage workers now have less buying power than they did 15 years ago. She also notes that many companies and their CEOs are enjoying big increases in profits and salaries with little of that making its way to the low-wage workers who staff their stores and businesses.
- Holly Skylar, McClatchy DC — Raise Minimum Wage to Raise America:
Time flies when you’re moving backward. With the federal minimum wage stuck at $7.25 an hour since July 24, 2009, workers now have less buying power than they did in 1997 at the start of the longest period in history without a raise.
It took 10 years, from 1997 until 2007, to raise the minimum wage above $5.15. A worker would need $7.36 today to match the buying power of the $5.15 minimum wage in 1997.
You’d have to climb higher up the mountain to reach base camp for 1956 when minimum wage was worth $8.44 in today’s dollars.
You’d have to climb much higher to get to the peak reached in 1968, when the minimum wage was $10.55, adjusted for inflation. …
“Our report on executive compensation will only fuel the outrage over corporate greed,” said Forbes. The CEOs of the 500 biggest U.S. companies “got a collective pay raise of 16 percent last year.” Their average compensation was $10.5 million.
That comes to $28,767 every day of the year.
Walmart CEO Michael Duke made $23.2 million. Duke’s $63,562 a day is more than many small business owners make in a year.
Remapping Debate also has a great interactive chart showing the gap between the family poverty threshold and the earnings of minimum wage workers over time.
Turns out, free uniforms aren’t exactly cutting it these days for low-wage workers and their families. Hopefully, Congress will take that letter from the top economists to heart and increase the minimum wage.