California Raises Minimum Wage to $10 per Hour

For Immediate Release: September 12, 2013

Contact: Daniel Massey, daniel@berlinrosen.com, (646) 200-5323

 

Stepping Ahead of Congress, California Leads Growing Number of States Poised to Raise Minimum Wage to at Least $10 Per Hour

Nancy Pelosi and George Miller Call on Congress to Follow California’s Lead By Passing the Fair Minimum Wage Act of 2013

Washington, DC – With California poised to raise its minimum wage to $10 an hour in two steps by 2016, and other states preparing similar moves, national elected leaders called on Congress to follow California’s lead and pass the Fair Minimum Wage Act of 2013.

In praising California’s leadership, U.S. House Democratic Leader Nancy Pelosi (D-CA) and Rep. George Miller (D-CA) called on Congress to raise the federal minimum wage to $10.10 per hour and index it to rise each year with the cost of living, as proposed in the Fair Minimum Wage Act of 2013 – a bill introduced by Rep. Miller and U.S. Senator Tom Harkin (D-IA) in March of this year, which has yet to receive a vote.

“When California leads, America takes notice,” said House Democratic Leader Nancy Pelosi.  “Governor Jerry Brown, Senate President Pro Tem Darrell Steinberg, and Speaker John Perez called for a higher minimum wage and put California’s workers ahead of the curve once more – and now it’s time for Congress to heed the call to act for working families.  We must pass the Fair Minimum Wage Act to follow California’s lead and ensure all American workers know the security, certainty, and dignity of a living wage.” 

“Economists agree that stagnant wages are hurting our economy and holding back the recovery’s full potential,” said Rep. George Miller. “That’s why increasing California’s minimum wage is so important. When workers are paid fairly, it’s a win-win for families and our economy. Now, Congress should follow California’s lead and raise the minimum wage for all hardworking Americans.”

Drawing on the widespread popularity of the issue, Congressional Democrats have signaled plans to make raising the federal minimum wage a high-profile issue ahead of the 2014 mid-term elections. In July, a national poll conducted by Hart Research Associates found that 80 percent of Americans, including 62 percent of Republican voters, support raising the federal minimum wage to $10.10 per hour. The poll also found that 74 percent of Americans consider raising the minimum wage to be an important legislative priority for Congress to address over the next year.

But with partisan gridlock slowing Congressional action on raising the federal minimum wage, California has now become the first of a growing number of states poised to pass minimum wage increases to at least $10 per hour over  the next year. Last week, Maryland Governor Martin O’Malley announced his support for efforts to raise the state’s minimum wage to $10.10 per hour and index it to the cost of living, and he called on the state legislature to make passage of this increase a top priority when it reconvenes in January. Earlier this month, Illinois Governor Pat Quinn also renewed his call for raising the state’s minimum wage to $10 per hour, citing fair wages as a priority for boosting the state’s economy.

And last month, a coalition of community, faith, and labor advocates in Massachusetts launched a campaign – with the support of U.S. Senators Elizabeth Warren and Ed Markey – to place a measure on the November 2014 ballot that would raise the state’s minimum wage to $10.50 per hour and index it to rise with the cost of living. Similar ballot initiatives to raise state minimum wages and adjust them based on the cost of living are underway in Alaska, South Dakota and Idaho for 2014, and such a measure will go before New Jersey voters this coming November. 

“With Congress continuing to drag its feet on a long-overdue increase in the federal minimum wage, it’s not surprising to see this groundswell of action on the state level to raise wages for low-paid workers and their families,” said Christine L. Owens, executive director of the National Employment Law Project. “But access to fair pay in exchange for hard work shouldn’t depend on what state you live in – it’s time for Congress to follow the lead of states like California and raise wages for all workers in the county by passing the Fair Minimum Wage Act of 2013.”

Economists point to California’s tipped minimum wage policy as a model for other states and the federal government to adopt. In California, as in six other states, tipped workers such as restaurant servers, hotel cleaners, parking lot attendants, and nail salon workers, are guaranteed a base hourly wage equal to the full minimum wage in the state – a policy that stands in stark contrast to federal law, which has guaranteed tipped workers a base wage of only $2.13 per hour since 1991. The Fair Minimum Wage Act of 2013 would restore the lost value of the federal tipped minimum wage by raising it to 70 percent of the full minimum wage and adjusting it each year to keep pace with the rising cost of living.

As the unemployment rate in many states continues to slowly decline, new job growth across the country remains disproportionately concentrated in low-wage industries such as retail and food services, making an increase in the minimum wage an urgent priority for growing numbers of working families finding themselves relying on low-wage work to make ends meet. Fully 58 percent of new jobs created in the post-recession recovery have been low-wage occupations, according to a 2012 report by the National Employment Law Project. Workers in retail and food services have highlighted the growing need for raises in a growing wave of strikes and protests that have swept across the country in the past year.

Raising the federal minimum wage to $10.10 per hour would boost pay for more than 30 million low-wage workers. According to an analysis by the nonpartisan Economic Policy Institute, 88 percent of these workers are adults over the age of 20; 85 percent work more than 20 hours per week; and 43 percent have at least some college education.  The minimum wage is also a staple of support for many families:  more than 15 million children in the U.S. have a parent who would benefit from raising the minimum wage to $10.10 per hour

The most rigorous economic research over the past 20 years shows that raising the minimum wage boosts worker pay without causing job losses – even in regions where the economy is weak or unemployment is high. A recent study by the Center for Economic and Policy Research reviews the past two decades of research on the impact of minimum wage increases on employment and concludes that “the weight of the evidence points to little or no effect of minimum wage increases on job growth.”  In February, leading mainstream economists polled by the University of Chicago’s Booth School of Business backed raising and indexing the minimum wage by a more than 3 to 1 margin, saying that the benefits outweigh any costs.  Similarly, 67% of small business owners support raising and indexing the minimum wage as shown in an April poll, which indicated that the majority believe it will help the economy.

The National Employment Law Project is a non-partisan, not-for-profit organization that conducts research and advocates on issues affecting low-wage and unemployed workers. For more about NELP, visit www.nelp.org or www.raisetheminimumwage.org.