Red States Could See Minimum Wage Hikes After Election Day
Even though most Americans support raising the minimum wage, most Republican-run states so far haven't done so.
Public polling shows that most Americans support raising the minimum wage above $7.25, the federal standard. Yet so far, most states under Republican leadership haven’t enacted a wage hike. That could change on Election Day.
Four states have ballot measures that would increase the minimum wage: Arkansas, Alaska, Nebraska and South Dakota. Three have Republican majorities in the legislatures and only Arkansas has a Democrat in the governor’s mansion.
In general, both state and national polls show that support for raising the minimum wage is higher among Democrats and independents than Republicans. A March survey by the Pew Research Center found that only a slight majority of Republicans (53 percent) favor a $10.10 minimum wage, which may explain why Republican governors and legislators haven't been as eager to enact such measures.
As Governing reported in April, advocates for raising the minimum wage are bypassing their elected representatives and putting the question directly to voters. Polling in all four states suggest the measures will pass.
|Alaska||61||33||Sept. 18-21||Public Policy Polling|
|Arkansas||68||24||Sept. 18-21||Public Policy Polling|
|Nebraska||56||33||Feb. 26-27||Prism Surveys|
|South Dakota||60||28||Oct. 21-26||SurveyUSA|
In Nebraska, state Sen. Jeremy Nordquist, of Omaha, first tried to get a bill passed through the legislature, but senators were evenly divided on the proposal. His legislation would have imposed incremental increases over three years, reaching $9 per hour by January 2017.
Ballot measures like the one in Nebraska are part of a wave of state and local efforts to lift wages for low-income workers that began last year with New York, California and New Jersey raising their states' minimum wage rates. In January, President Obama used his State of the Union to ask more states and cities to raise the local minimum wage, rather than wait for Congress -- which in April voted against even taking a vote on the federal minimum wage. Ten more states passed wage hikes this year, in addition to cities such as Seattle, the District of Columbia and several others.
“We saw the gridlock in Washington,” Nordquist said. “It was time to take action.”
In states with higher wage floors than the federal requirement, minimum hourly pay ranges from $7.50 in Maine to $9.32 in Washington state. Ten states index their state minimum wages to local cost-of-living adjustments, meaning that they automatically rise with inflation.
Most of the states that have enacted wage increases this year do not index to inflation. Connecticut, for example, is set to reach a minimum wage of $10.10 by 2017. Workers who receive that hourly pay will see the real value decrease in future years unless the legislature passes another wage hike.
The current ballot proposals all start at or close to the federal wage floor. The measures in Arkansas and Nebraska are small increases compared to some of the laws passed this year by state legislatures controlled by Democrats. Neither one ties future increases to inflation. The proposed changes in Alaska and South Dakota, however, are significant, particularly because voters have the choice to make future increases automatic.
The chart below compares the four proposals (in bold) with the 10 that passed in 2014. In the case of Minnesota, the chart shows two minimum-wage tiers, one for large businesses and one for small businesses. Michigan's minimum wage was $7.40 until September, when a new law pushed it to $8.15; the chart shows where wage floor was for most of the year.
Nordquist said the Nebraska ballot measure doesn't aim higher because he considered polling data and the cost of living when drafting his legislation. A February poll by Prism Surveys showed that only a third of voters supported a $10.10 minimum wage. “There wasn’t quite the support for going more than $9,” he said.
He also acknowledged that annual pay at minimum wage in Nebraska stretches further than in more urbanized states, where low-income workers can struggle to find affordable housing near their place of employment. An analysis by Governing's Mike Maciag shows that hourly pay at minimum wage has higher purchasing power in some places than others, depending on the cost of housing, food, utilities and other living expenses. An hourly wage of $7.25 in Jonesboro, Ark., for example, is worth more than the lowest possible hourly pay in the District of Columbia, $8.25.
About 3.3 million workers are paid hourly rates at or below the minimum wage, roughly 4.3 percent of all hourly paid workers, according to the U.S. Bureau of Labor Statistics. An analysis by the Congressional Budget Office earlier this year estimated that raising the federal minimum wage to $10.10 would lift incomes for 16.5 million people, but would also cost 500,000 jobs. The finding emphasized that the policy comes with tradeoffs, even if it benefits far more people than it hurts. A Bloomberg National Poll in March found that while 69 percent of Americans supported a $10.10 minimum wage, a majority (57 percent) said the tradeoff -- even at a ratio of one job lost for every 33 jobs receiving better pay-- was unacceptable.
Even though the national minimum wage has been raised by statute repeatedly from its original amount (25 cents in 1938), its real value -- relative to rising consumer prices -- has been steadily on the decline since 1968. That's because legislative raises haven't been high enough or haven't happened consistently enough to keep up with the rate of inflation.
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