In the United States – a country that is more politically polarized today than at any point in the past quarter-century – the issue of minimum wage should be a highly contentious topic.
Turns out, it isn’t.
Voters in five states and numerous cities and counties across the country voted almost universally in favour of hiking the minimum wage in their jurisdictions on Tuesday. The overwhelming voter support comes as several other states have moved to raise their income floors in recent years – indicating that minimum wage is, perhaps surprisingly, one of the few topics U.S. voters and politicians of different stripes can agree on.
“While it is difficult to say exactly why voters support these policies … most of the polling evidence suggests fairly widespread support for the policy across the political spectrum and income levels,” said Arindrajit Dube, an associate professor of economics at the University of Massachusetts Amherst who has conducted extensive research on minimum wage policies.
“This suggests that most people see this as a matter of fairness – that there should be a minimal standard for what someone should get for an hour’s work based on overall wage levels in the economy.”
Voters in Alaska, Arkansas, Nebraska and South Dakota all voted in favour of raising the state minimum wage on Tuesday. Currently, three of those states have minimum wages roughly in line with the federal level of $7.25 (U.S.) an hour (the minimum in Arkansas is $6.25 an hour). In the next two years, all four states will have new wage floors of between $8.50 and $9.75.
Additionally, voters in Illinois passed a motion calling for a $10 minimum wage in 2015 – that would give the state one of the highest wage floors in the country. However, the measure is non-binding. A number of other cities and jurisdictions also voted in favour of raising the minimum wage. (only the city of Eureka, in California, saw voters turn down a minimum wage hike measure). In San Francisco, voters approved a measure to raise the minimum wage to $15 an hour by 2018.
Both solidly Democrat San Francisco (the highest-wage city in the country) and Republican-dominated Arkansas (the second-lowest wage state) saw voters support the wage hikes, indicating politics and income have a smaller impact on voters’ opinions on the issue than other matters, such as same-sex marriage. Indeed, San Francisco offers some (albeit limited) evidence that support for minimum wage increases has grown in recent years. A decade ago, 60 per cent of voters in the city approved a wage hike – this year, more than 76 per cent voted in favour.
Support for such hikes, however, is still not universal. Some business groups argue the raises wipe out jobs because they overwhelmingly burden small businesses. For example, the lobbyist National Federation of Independent Business has fought vehemently to keep Washington from raising the national minimum wage to $10.10 by 2016 and indexing it to inflation. The group argues that, rather than lift low-wage earners out of poverty, an increase would make it more difficult for those workers to find jobs in the first place.
“Workers must bring at least as much value to the firm as they are paid or the firm will fail and all jobs will be lost,” the group said in a recent report on the impact of a federal minimum-wage hike. “Raising the minimum wage raises the hurdle a worker must cross to justify being hired.”
Some small business groups in Canada have also fought against minimum wage hikes. However, the situation is somewhat different north of the border. The lowest minimum wage in Canada – $10 (Canadian) an hour in New Brunswick and the Northwest Territories – is still higher than the highest current minimum wage in any U.S. state.
However, many economists argue that such claims are overly pessimistic.
“Most studies find very little impact on the level of employment in restaurants or retail, which together hire the majority of minimum-wage workers,” said Prof. Dube. “At the same time, the evidence suggests that job turnover falls when minimum wage rises, as workers tend to stick around their jobs a bit longer – the savings on the replacement cost offsets some of the cost increase from the policy.”
Nationwide, however, many states still have a minimum wage essentially tied to the federal level, and a White House-led effort to raise that rate earlier this year met immense political resistance, ultimately failing.Report Typo/Error
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