Recently there have been conversations happening about the impacts of the minimum wage increases in St. Paul and Minneapolis. There are genuine concerns about how to measure economic impacts that came during a global pandemic, an uprising against racism and huge changes in how and where people work, but those valid critiques aren’t even our biggest concerns.
We once again find ourselves frustrated that the story of the impacts of policy on workers ends up being only about questionable charts and graphs, not real people. How many working people did these experts talk to when they made determinations about hours worked? How many workers who saw their wages increase and potentially could cut back from three jobs to two did these experts speak to about what that means for our state?
We know who disproportionately hold jobs paying minimum wage: immigrant communities, people of color and women. Those groups are the core of our organizations, and those groups were at the forefront of fighting to raise wages to address the awful racial inequalities that have and continue to be an embarrassment to our state.
These stories imply the workers who fought hard to pass these bills somehow don’t understand how this works. As if raising wages isn’t something that moves wealth into the hands of working people and improves lives. Our members have seen – over and over – the reality of greedy bosses who will do everything they can to divide us and pit us against each other. In this case, the so-called experts are doing their work for them.
Here is what our members know: they were called “essential” throughout the pandemic but are often paid so little that they need to work two or three jobs just to make ends meet. They often work for companies or in buildings that house corporations that are seeing their profits skyrocket. While bosses got to work from home during COVID, our members were doing the work to keep our society running. Yet now they’re being told that raising the minimum wage to just $15 is somehow bad for workers. What an insulting, misguided, close-minded outlook.
Maybe if the workers of color who fought to pass the minimum wage were asked, they’d say that things have gotten better because of the upward pressure of wages, and trying to make sense of employment data during a pandemic and when work from home is changing the retail industry doesn’t make sense?
Our organizations are proud to have strong, powerful bases of workers of color who don’t let this silliness get them frustrated or distracted. They are treated with disrespect from their bosses every day, but they stand strong in the fight to improve our workplaces, our communities and our whole state. This latest round of discouraging workers and making them feel guilty for “getting raises” is not new and it certainly won’t stop our members from continuing to fight to increase wages across the state.
Our current systems don’t hear the voices of working people – especially workers of color. That’s why we organize and that’s why we build power. Everything from policy to “reports” would be better if they included actual people directly impacted. You know who could tell you if the minimum wage has been good for minimum wage workers? We’ll let you guess, but it isn’t a bunch of disconnected people writing reports from home offices or workplaces cleaned every day by our members.
We know raising the minimum wage is good for workers, it’s good for small businesses who get the money poured right back into our community, and it’s good for the health of our state to have money in the hands of working people and not a handful of people getting rich off our hard work. We don’t need a years-long study to tell us that.
Eli Stein is the lead organizer with Restaurant Opportunities Center of Minnesota (ROC-MN), Rod Adams is executive director of The New Justice Project, Veronica Mendez Moore and Merle Payne are co-directors of Centro de Trabajadores Unidos en Lucha (CTUL) and Abdirahman Muse is the executive director of The Awood Center.
Didn’t the Fed Reserve just release a report that said jobs decreased, hours decreased, and true earnings decreased for Minneapolis.
This article is all just feel-good monikers and shows zero proof that higher minimum wage actually helps.
So maybe the experts are actually right.
After the report from Federal Reserve came out, I was shocked to find how many folks here at Minnpost had no idea what small business owners make and go through to stay in business. The Fed reserve report show jobs and hours went down. That makes perfect sense to folks who understand the hardships of small business owners.
This article claims the Federal Reserve just didn’t talk to the proper people. I wonder who these people are?
As a small business owner working with small business owners, I can verify that everything you imply about wages and staying in business is wrong. Anyone who structures their business in a way that can’t pay their workers a good living wage shouldn’t start that business. Full stop. If you need to rely on destitute and/or desperate people to supply labor so you can make money, you are starting a business that isn’t needed.
Dan, you start your business paying a comparable wage for your workers, when that is artificially inflated by Government law to 15 bucks an hour, you have to adjust. Not sure what small businesses you are running or working with but the reality is artificially inflating wages cause employers to make changes. Those changes happen to be exactly what the Federal Reserve reported. End of story.
If $15/hr is “inflated” from what you want to pay for wages you are a terrible business person. Relying on other people’s poverty for you to make a living isn’t a defensible position. But neither is an idea of freedom that defended slavery and genocide but conservatives can’t understand that very simple point either.
This finger pointing crap is getting old. Just give us the facts, and not someones biased opinion of the facts. The Federal Reserve report was clear: the increase in the minimum wage has caused job losses. Your choice. $15 minimum wage and job losses, or stay the course on wages that reflect ownerships ability to stay in business.
No – it wasn’t that clear. It found a correlation, not causation. And even the correlation was in the context of some extremely extraordinary circumstances. We are in one of the lowest unemployment times in our history (2.7% in the Twin Cities area) – businesses complain they can’t find enough workers (and conservatives gripe that “no one wants to work”). It simply cannot follow that there aren’t enough jobs for ANY reason, let alone because wages are higher. It’s like saying that when I put on my shoes today, the sky turned into mud, and everyone accepts as fact that putting on my shoes turned the sky to mud. Except if you look up…the sky is still the sky. Higher wages isn’t causing unemployment, even if there are fewer jobs.
Bob and Joe…..The Independent non-profit Economic Policy Institute Offers this for you: The average annual income for the bottom 99% is about $50,000; The average annual income for the top 1% is just above $420,000.
In 2020, the annual wage for the top 99% grew by 7.2% while the average annual wage for the bottom 1% grew by 1.7%.
This makes perfect sense for those who have a difficult time understanding the plight of low wage employees in comparison to their well-off employers.
So, you are saying what? That the 1% obtain their wealth illegally? That the 1% owe you some of their wealth above poverty? Why?
Of course the workers are happier when they have more money in thier pocket. However, they are ignoring the laws of economics. The worker gets $15 an hour instead of $7, but a combo meal now cost $10 instead of $5. Net result is even.
You’re assuming the corporate employer has power over price and can also dictate his desired (and apparently permanent) profit level. Not sure those were taught as laws of competitive microeconomics…
With the labor shortage today anyone who is reliable and a good worker is paid more than $15 an hour. If you are not, start looking, the jobs are there.
Spot on!
If a small business can’t pay the workers it needs $15/hr and still make a normal profit for its owner(s), then the reality is that it is not a viable business in 21st Century America. Not every job “lost” is a job worth having or maintaining in our society.
There seems to be an element of fantasy in the minds of many would-be small business owners. Leave aside that many successful small businesses bid wages up above this level as a result of the ongoing labor shortage. And their true enemies are the giant corporations mopping up every industry in America, not low wage workers.
I doubt that the recent Federal Reserve report will end up being the final word on this (much-studied) topic of labor economics anyway. So don’t put all your eggs in one report basket, white “conservative” naysayers, who defend the failed economic status quo to the death. Would YOU happily work for less than $15 an hour in 21st Century America?
You just admitted that the report is correct. If a rise in the minumum wage makes a job no longer viable, and a job is lost.
Yes, by definition. The problem is determining how much the labor and employment market contracted during Covid for other reasons. I agree with the article that this was not an ideal period in the economy on which to base firm conclusions.
But I also agree with you that increasing the minimum wage can result in some price increases in some previously lower wage industries. But that’s the true “cost” of the service/good in America. A price we should pay if we want that service.
You did not mention anything about the numbers of workers employed at $15/hr?
A hundred years ago many people worked as domestic servants. Tragically, most of those jobs have now disappeared. How will the working class survive?
Simple numbers to show what Fed Reserve observed and reported. To be in the top 10% of income earners in USA, you make $172,000. Small business owners hire the most people in America. Small business owners average salary is $65,000. The group of employers who hire the most workers in United States can’t afford to pay employees $15 an hour for unskilled labor. To adjust to mandatory $15 pay per hour the small business owner will cut hours or cut workers.
Not sure why folks are using top 1% of earners and how their income relates to $15 minimum wage. Small business owners are not close to top 1% of earners. Entrepreneurs who love to work for themselves and hire people to help them, drive the minimum wage workforce.
These “simple numbers” (if true) are mostly irrelevant data points, none of which explain why a viable and successful small business in the 21st Century will find it impossible to survive with the higher minimum wage. And, again, if a business can’t pay a worker that minimum wage, the “job” is not worth keeping in today’s economy.
And yet, the $15.00 minimum wage that was supposed to fix everything, in fact isn’t enough according to most readers here.
That “job” is likely caring for a senior citizen, which many of us would consider a “job worth keeping”, even if you don’t.
Simple numbers show a remarkably low unemployment rate. When I quit my last job, 18 months ago, we had trouble hiring unskilled warehouse labor at $18, mostly due to Amazon. At my current employer we’re investing in automation because labor is hard to find. My neighborhood mom n pop grocery store installed self check-out lanes, because hiring is tough. Minimum wage hikes aren’t killing minimum wage jobs, higher paying jobs for unskilled labor are killing minimum wage jobs. That should be celebrated.
Over 80% of small businesses have zero employees other than the owner so aren’t impacted by the minimum wage. Therefore they aren’t drivers of the minimum wage workforce. So you are, again, 100% wrong on the impact of the minimum wage. Whether on purpose or out of a lack of effort is unknown. If you are an owner making $65k a year, need support, and can’t afford to pay a living wage, you aren’t very good at business.
Now there is some actual relevant data! Thanks.
Another big thing that Joe is either unaware of or purposefully not clear about, is how business owners use the tax system. Reporting $65k a year as your income is much different when earnings as a business owner vs straight salary. The ability to write things off can make a huge difference in the lifestyle you have. Business owners figure this out quickly and work to minimize the amount of taxable personal earnings they report.
Nice response