Author: E. Fletcher McClellan
Last week, state lawmakers confronted Gov. Tom Wolf’s administration over its proposal to raise the state minimum wage from the federal minimum of $7.25 an hour to $12 an hour by July, gradually, and to $15 an hour in 2025.
Nearly 30 states, including all of Pennsylvania’s neighbors, have a minimum wage higher than the federal standard. Twenty-one states, including all-red Arkansas and South Dakota, will raise their minimum wages this year.
The question is whether Pennsylvania will join a distinctly national movement.
Judging by recent statements by Wolf and legislative leaders, as well as testimony during budget hearings, the outlook is uncertain.
Republicans were sharply critical of Wolf’s proposal. However, Senate Majority Leader Jake Corman, R-Centre, and House Appropriations Committee Chairman Stan Saylor, R-York, said that while $12 an hour is too high, they are open to negotiating smaller minimum wage increases.
The need to escalate the minimum wage is obvious.
Because it is not tied to inflation, the federal minimum wage has fallen to $6.19 an hour since 2009, when the current level was last set. The annual income of a full-time worker paying the federal minimum wage in 2016 was $15,080, which is less than the official poverty level.
These are the working needy, not the crooks and greedy people that the malicious like to condemn. About half are youthful, although less than 25 percent are teenagers. Most are white, most are women, many of them have children to support. By far the largest occupational group receiving the minimum wage are catering workers, followed by salespeople and people providing personal hygiene services.
That said, reasonable people can disagree on how much the minimum wage should escalate. During last week’s budget hearing, Republicans cited a 2018 study by the Independent Internal Revenue Service that found a $12 minimum wage would result in 33,000 job losses.
At the same time, we also know that there are dislocations in the labor market that give employers an advantage. Rural areas where jobs are limited, a immense supply of immigrant workers, professions where trade unions are sporadic – all these conditions lead to substandard wages.
For every analysis linking higher minimum wages to unemployment, others find little or no overall effect on employment.
In a renowned study that analyzed the labor market shared by higher-earning New Jerseyans and lower-earning Pennsylvanians, job losses attributable to the higher minimum wage were offset by increased worker productivity and lower employee turnover.
The focus on the impact of the minimum wage on jobs, while essential, overshadows the many positive effects of raising wages for low-income workers.
The same IFO study that calculated net job losses from the minimum wage escalate also found that the net wage escalate for the hundreds of thousands of workers directly affected by the change would be $3 billion per year, a significant escalate in purchasing power.
The social effects of minimum wage increases are also often ignored. As Wolf administration officials have testified, low-income workers who receive a raise are less likely to need public assistance.
Research on minimum wage increases conducted at the University of California, Berkeley, shows improvements in the health of workers and their children, as well as improvements in children’s school achievements and cognitive and behavioral outcomes.
An encouraging sign from last week’s hearing was that both Democrats and Republicans agreed on the need for workforce development initiatives that would close the skills gap that prevents workers from obtaining higher-level jobs.
But rather than presenting the choice facing lawmakers as either/or, it appears that action is needed on both workforce development and the minimum wage. There is little evidence that a higher minimum wage discourages workers from improving their employability.
Political incentives may favor agreement on a minimum wage. A 2017 Franklin & Marshall College poll found that more than 60 percent of Pennsylvanians support an escalate to $12 an hour.
The spirit of bipartisanship last year in Harrisburg, which saw no across-the-board tax increases and compromises on the education budget and other issues, could continue into 2019 if the economy continues to grow.
On the other hand, as the 2020 elections approach, we will certainly see more partisanship and ideological attitudes. In particular, many Democratic presidential candidates have signed on to the Fight for $15 campaign.
The prospect of a nationalized election and the uncertainty that comes with it should push Pennsylvania politicians to be more collaborative this year.
For those who want a minimum wage escalate, now is the time.
E. Fletcher McClellan, Capital-Star opinion writer, is a professor of political science at Elizabethtown College. His works appear frequently.
