Issue Brief:  Time to Raise Connecticut’s Minimum Wage - Young Workers in CT Need a Raise

Time to Raise Connecticut’s Minimum Wage

Connecticut’s Young Workers Need A Raise

  • Connecticut’s current minimum wage is stuck at $8.25, which amounts to just $16,500 per year for a full-time worker. There is not a single area in Connecticut where the cost of living is low enough for this wage to provide basic economic security for even a single worker, let alone one with children.
  • While the median wage in Connecticut has increased 21 percent since 1979, the real value of the minimum wage has fallen by 9 percent, trapping low-wage workers behind their peers.[ii]
  • A proposal in the state legislature would raise the state minimum wage to $8.75 per hour. This proposal would increase wages for around 160,000 workers while creating or supporting approximately 600 full-time jobs.[iii] 

Who Benefits From Raising the Minimum Wage?[iv]

The image of minimum wage workers as teenagers holding down part-time jobs to make some extra spending cash is a myth:

  • Around 80 percent of those affected by the proposed increase in Connecticut are workers over the age of 20.
  • 70 percent work more than 20 hours per week, with nearly half of those workers holding full-time jobs.
  • Those affected by the proposed increase are responsible for providing, on average, no less than 32 percent of their entire family income. Parents affected by the proposed increase contribute an average of 45 percent of all family income.

The Student Squeeze in Connecticut

Many critics dismiss the need for a higher minimum wage by claiming that a large share of the beneficiaries are youth living at home with their parents. This claim is severely misleading: the Census Bureau includes students living in college dormitories in their calculation of young adults living in their parents’ home.[v] As the chart below shows, a substantial and growing number of students in the U.S. are also full-time workers trying to make ends meet.

Percent of Students in the U.S. Working 35+ Hours per Week[vi] 

 

Academic Year 1989-90

Academic Year 2007-08

Pursuing Associate’s Degree

45.2%

50.4%

Pursuing Bachelor’s Degree

31.4%

33.0%

Yet even as students have started working more to pay for their education, the return from this effort is diminishing as costs of college attendance rise. In Connecticut, the cost of public higher education has increased substantially over the past 20 years while financial aid as only shrunk.

  • Tuition and fees for public 4-year colleges in Connecticut have risen by 117 percent since the 1990-91 school year (the 14th-fastest rate of increase for any state in the country). For 2-year colleges, tuition and fees have increased by 103 percent (the 12th-fastest rate of increase in the country).
  • At the same time, state funding for need-based financial aid in Connecticut has dropped 11 percent since the 1990-91 academic year.
  • The double-squeeze of higher costs and diminished support is making college completion increasingly difficult: Despite increased enrollment, graduation rates at 4-year public colleges in Connecticut have only risen 2.3 percent since 1990-91, and graduation rates have actually dropped by 11 percent for 2-year colleges.[vii]

The cost of higher education in Connecticut is substantially higher than the average nationwide. Consequently, even the current proposal to raise the state minimum wage to $8.75 – approximately 20 percent higher than the current federal rate of $7.25 – is insufficient in order to deliver real gains to low-wage workers.

Average Annual Tuition and Fees for the 2009-10 Academic Year[viii]

 

United States

Connecticut

Percent Difference

2-Year Public College

$2,285

$3,119

+37.5%

4-Year Public College

$6,695

$8,375

+25.1%

What Kind of Future Do We Want For Young Workers in Connecticut?

While student workers in Connecticut face considerable and growing costs, the state’s economy is no more forgiving for non-students. 57 percent of all job growth in Connecticut through 2018 will come from jobs that require less than a 4-year degree – and these occupations overwhelmingly pay wages that do not guarantee basic economic security for single workers.

Connecticut: Wages for High-Growth Occupations Requiring Less Than a 4-Year Degree[ix] 

Occupation

Average Wage

Registered Nurses

$35.51

Customer Service Representatives

$18.33

Economic Security Wage (Single Workers)

$17.61

Nursing Aides

$14.71

Landscaping Workers

$14.59

Home Health Aides

$14.03

Teacher Assistants

$13.80

Retail Salespersons

$12.81

Food Preparation Workers

$10.03

As the chart shows, single workers in Connecticut need to earn $17.61 per hour in order to remain economically secure. This is over twice as high as the current minimum wage ($8.25) and still far ahead of the current proposed increase of $8.75. An aggressive increase in the wage floor is needed to generate upward pressure on the average pay in each of these professions. 

Policy Recommendation

A substantial increase in the minimum wage with a provision for annual indexing to the cost of living is needed to provide basic economic security for young workers in Connecticut. Absent this, as the cost of living in the state continues to rise, the real value of the minimum wage will only decline, providing young workers with fewer resources to work their way up the ladder.

The Connecticut state legislature is currently considering a bill that would raise the state minimum wage to $8.75 per hour in two steps by January 2014. This bill has already passed the State Assembly, yet support in the State Senate remains uncertain. The Senate should pass this minimum wage increase – with no further watering down - and Governor Malloy should sign it.

 

Click here for a printable PDF version of this Issue Brief.

 


http://ctpcsw.files.wordpress.com/2010/07/basic-economic-security-tables-index-for-connecticut-2011.pdf

[ii] http://www.ctvoices.org/sites/default/files/econ12raiseminwage.pdf

[iii] NELP estimate revising Economic Policy Institute (EPI) analysis of U.S. Census Bureau Current Population Survey (CPS) data, which was done based on the original $9.75 minimum wage proposal, found here: http://www.ctvoices.org/sites/default/files/econ12raiseminwage.pdf

[iv] Id.

[v] For explanation of source: http://www.census.gov/newsroom/releases/archives/families_households/cb11-183.html. Example of misuse of source: http://epionline.org/downloads/120305_EPI_PolicyBrief.pdf

[vi] For 1989-90: http://nces.ed.gov/pubs94/94311.pdf; For 2007-08: http://nces.ed.gov/pubs2010/2010205.pdf

[vii] All data from: http://www.demos.org/sites/default/files/publications/thegreatcostshift.pdf

[viii] http://www.demos.org/sites/default/files/publications/TheGreatCostShift_Demos.pdf

[ix] http://ctpcsw.files.wordpress.com/2010/07/basic-economic-security-tables-index-for-connecticut-2011.pdf

The FactsThe Facts

$10.90

How much the federal minimum wage would be if it had kept up with inflation over the past 40 years. Instead, itís $7.25. Learn More

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