A Livable Minimum Wage

If George W. Bush finishes a second term and avoids adjusting the federal minimum wage, we will have completed an 11-year record stretch without any adjustment. The previous record of nine years was brought to us by Ronald Reagan. The current federal minimum wage of $5.15 per hour is over 40 percent below the 1968 level adjusted for inflation. A full-time worker taking no vacation or holidays and earning the federal minimum wage earns 55 percent of the federal poverty line for a family of four and a much smaller percentage of what it takes to actually pay the rent and basic living expenses in most parts of the country. Such a worker qualifies for much of what remains of public support and assistance, placing the burden on taxpayers to pick up where employers fail to pay a living wage.

Grassroots organizations have responded to the static minimum wage by focusing on the state level. After winning living wage laws in 123 cities and counties (laws that mandate higher minimums for certain categories of workers) and city-wide minimum wage hikes covering all workers in four cities (D.C., Santa Fe, San Francisco and Madison), the campaign for decent wage standards has shifted the battleground to the state level.

Thirty-one states, plus the District of Columbia, have either set a minimum wage higher than the federal level of $5.15 per hour, or have had bills introduced in their legislatures this year that would do so.

Fourteen of these, plus D.C., have already created minimum wage levels higher than the federal, or – in the case of Florida – have put the law on the books though it has yet to take effect. Three of these 14 (Washington, Oregon and Florida) have indexed their minimum wage levels to automatically increase each year with the cost of living, thus eliminating the need for an annual campaign to prevent the minimum wage from losing value. Five of the fourteen (Massachusets, California, Connecticut, Hawaii and Vermont) also have bills in their legislatures that would further increase their minimum wages.

Of the 17 states that do not yet have higher minimum wages but have had bills introduced this year, two (Wyoming and North Dakota) have already seen those bills defeated. Bills in some other states have a good chance of succeeding. Three that are almost certain to fail (Arizona, Ohio and Michigan) are in states where activist campaigns led by the community group ACORN along with labor and other allies, are fully committed to gathering the signatures needed to force the issue onto a ballot initiative in 2006. The voters in Nevada, like those in Florida, passed a minimum wage increase by ballot initiative last November which included indexing to the cost of living, but initiatives in Nevada must be passed twice. The second vote, which is expected to succeed, will come in 2006.

The movement for a fair wage has moved to the state level in part because no one expects action out of Washington as long as Republicans control the Congress and the White House. Another factor is the success of living wage efforts at the local level. There aren't very many big cities left to win a living wage ordinance in. Only four passed them in 2004, bringing the total to 123. But at least as big a factor as these is the approach that the opposition has taken. As a result chiefly of lobbying and campaign contributions from hotels and restaurants, and the "think tanks" they fund, eight states have banned city-level minimum wage laws. It's nine if we include Missouri, which is in dispute. The other eight are Arizona, Louisiana, Colorado and Texas, plus two that also ban local living wage laws (Utah, South Carolina) and two that at least have state-level laws, making the ban on local laws less damaging, (Oregon and Florida).