Published in the May 27, 2016 Santa Maria Times.
When Gov. Jerry Brown signed California’s $15-per-hour minimum wage law, he called the landmark legislation a matter of economic justice. The millions of workers who will benefit from this increase will certainly agree.
At Allan Hancock College I deal with many students who come from poor families. Many of them also work at minimum-wage jobs in an attempt to support themselves and offset the cost of books and tuition. As one of my students put it recently, cleaning houses, picking vegetables and fast-food restaurants are the top low-wage jobs Those working in such jobs struggle to provide the basic necessities for themselves and their families. For them, an increase in the minimum wage is a welcome boost.
But it will hardly solve all their problems. The increase is gradual, not taking full effect until January 1, 2022. Businesses employing 25 people or less will not have to implement the new wage until a year later. Minimum-wage workers will not start to see any impact from the wage increase until January 1, 2017, when it will rise to $10.50 per hour.
In Santa Maria, a minimum wage of $12.62/hour is required to lift a person above the poverty level, so those people working for minimum wage will remain in poverty for the foreseeable future.
When the minimum wage was first introduced in 1938 — at 25 cents per hour — it was seen as a means to give the lowest-paid workers a living wage, which is defined as a wage that is high enough to maintain a normal standard of living. From the 1960s until the 1980s, the minimum wage was enough to keep a family of two from falling into poverty. In terms of purchasing power, it peaked in 1968 at $1.60, when the economy was booming, with an unemployment rate of 3.8 percent. Since then, prices have continued to increase, and the minimum wage has not kept up.
The typical minimum-wage earner in 2016 is not a teenager working part-time. In fact, only 11 percent of minimum-wage workers are teens. The average age is 36, with 37 percent being past 40. Twenty-eight percent have children, and 56 percent are women.
Here in California, two-thirds of minimum-wage earners work full-time. Since the minimum wage is not enough to keep these people out of poverty, they frequently seek public assistance, at taxpayer expense. Lifting these people out of poverty benefits us all.
Conservative politicians and economists have long argued that increasing the minimum wage hurts the economy and causes a rise in unemployment. But evidence points in the other direction. The Labor Department points out, since 1938, the federal minimum wage has been increased 22 times. For more than 75 years, real GDP per capita has steadily increased, even when the minimum wage has been raised.
Seventy percent of the American economy is based upon consumer spending. The more money people have to spend, the more the economy will grow. An increase in the minimum wage gives poor households more buying power.
Those households are by far the largest consumers of the goods and services created with minimum-wage labor — another argument in favor of increasing the minimum wage. Raising the minimum wage helps everyone, not just the people who work in industries such as fast-food or retail sales.
President Obama has commended those states that are increasing their minimum wage, thanking the strong leadership of elected officials, businesses and workers who organized and fought so hard for the economic security families deserve.
Mark James Miller, President, Part-Time Faculty Association of Allan Hancock College, CFT Local 6185, Santa Maria, CA