Raising minimum wage in N.C. would benefit business and ease a social inequity
Asheville CITIZEN-TIMES.com
January 7, 2006
Raising minimum wage in N.C. would benefit business and ease a social inequity
Earlier this week State Treasurer Richard Moore made some compelling arguments as he encouraged North Carolina corporate executives and other business leaders to support a $1 per hour increase in the minimum wage.
For business leaders, the most persuasive argument may well have been that businesses do better when people have more money to spend.
“Raising the minimum wage is a pro-business policy,” Moore argued. “Study after study has shown that in the periods after a minimum wage increase, the labor market shows few negative effects. In fact, some studies have even shown that the labor market improves for low-income workers. This is because businesses actually start to do better when consumers have more money in their pockets.”
Moore noted that Wal-Mart CEO Lee Scott has expressed support for raising the minimum wage because he understands that it would “ultimately improve his bottom line.”
The state treasurer’s remarks came at the North Carolina Citizens for Business and Industry’s Annual Economic Forecast Forum. Moore also pointed out to businesses that, thanks to the low minimum wage, many of them are subsidizing their competitors.
“I have talked with several of you about this,” he said. “Not only were you shocked to find out that the minimum wage was so low, but you said that you pay well above it. However, if your competition pays only the bare minimum, their employees are almost forced to use public programs paid for by your tax dollars to get by. You are subsidizing your competitors’ business.”
Moore deserves credit for connecting the dots, but also for promoting legislation that would benefit many low-income North Carolinians before a group that has generally been hostile to it because they perceive that it will cost them money.
As Moore pointed out, the costs of health care, gasoline and housing are all going up.
“You know that these expenses affect the bottom line of your businesses,” he said. “But for North Carolina’s low-income families, these costs are all too often a crushing burden.”
When adjusted for the rise in prices since 1997, the current minimum wage, which is $5.15 per hour, is worth less than it was before the last increase, Moore said.
In fact, according to the Economic Policy Institute, wage inequality has been increasing. That’s in part because of the declining real value of the minimum wage. The minimum wage today is 33 percent of the average hourly wage of American workers. That’s the lowest level since 1949.
A worker earning minimum wage who works 40 hours a week, 52 weeks a year, earns $10,712 before taxes.
One hundred thousand North Carolinians would benefit if the state legislature raised the minimum wage, Moore said, more than half of them age 25 or older.
“Raising the minimum wage would also help thousands of teen-agers and college students,” Moore said. “One of the most troubling statistics I’ve heard recently is that more students drop out of college because of financial reasons than because of grades.”
It’s hard to argue with the state treasurer’s logic. More importantly it’s hard to argue with his sentiment.
“We want an economy where existing businesses thrive and new businesses grow,” he said. “And we want our citizens to be able to support their families through hard work. ... Our workers deserve it. Our morals demand it. And our state’s economy will be better off for it.”
Here’s hoping the state’s business leaders got the message and will do their part to persuade North Carolina lawmakers to join the 17 other states that already have minimum wages higher than the federal minimum wage.
January 7, 2006
Raising minimum wage in N.C. would benefit business and ease a social inequity
Earlier this week State Treasurer Richard Moore made some compelling arguments as he encouraged North Carolina corporate executives and other business leaders to support a $1 per hour increase in the minimum wage.
For business leaders, the most persuasive argument may well have been that businesses do better when people have more money to spend.
“Raising the minimum wage is a pro-business policy,” Moore argued. “Study after study has shown that in the periods after a minimum wage increase, the labor market shows few negative effects. In fact, some studies have even shown that the labor market improves for low-income workers. This is because businesses actually start to do better when consumers have more money in their pockets.”
Moore noted that Wal-Mart CEO Lee Scott has expressed support for raising the minimum wage because he understands that it would “ultimately improve his bottom line.”
The state treasurer’s remarks came at the North Carolina Citizens for Business and Industry’s Annual Economic Forecast Forum. Moore also pointed out to businesses that, thanks to the low minimum wage, many of them are subsidizing their competitors.
“I have talked with several of you about this,” he said. “Not only were you shocked to find out that the minimum wage was so low, but you said that you pay well above it. However, if your competition pays only the bare minimum, their employees are almost forced to use public programs paid for by your tax dollars to get by. You are subsidizing your competitors’ business.”
Moore deserves credit for connecting the dots, but also for promoting legislation that would benefit many low-income North Carolinians before a group that has generally been hostile to it because they perceive that it will cost them money.
As Moore pointed out, the costs of health care, gasoline and housing are all going up.
“You know that these expenses affect the bottom line of your businesses,” he said. “But for North Carolina’s low-income families, these costs are all too often a crushing burden.”
When adjusted for the rise in prices since 1997, the current minimum wage, which is $5.15 per hour, is worth less than it was before the last increase, Moore said.
In fact, according to the Economic Policy Institute, wage inequality has been increasing. That’s in part because of the declining real value of the minimum wage. The minimum wage today is 33 percent of the average hourly wage of American workers. That’s the lowest level since 1949.
A worker earning minimum wage who works 40 hours a week, 52 weeks a year, earns $10,712 before taxes.
One hundred thousand North Carolinians would benefit if the state legislature raised the minimum wage, Moore said, more than half of them age 25 or older.
“Raising the minimum wage would also help thousands of teen-agers and college students,” Moore said. “One of the most troubling statistics I’ve heard recently is that more students drop out of college because of financial reasons than because of grades.”
It’s hard to argue with the state treasurer’s logic. More importantly it’s hard to argue with his sentiment.
“We want an economy where existing businesses thrive and new businesses grow,” he said. “And we want our citizens to be able to support their families through hard work. ... Our workers deserve it. Our morals demand it. And our state’s economy will be better off for it.”
Here’s hoping the state’s business leaders got the message and will do their part to persuade North Carolina lawmakers to join the 17 other states that already have minimum wages higher than the federal minimum wage.
posted by One Dollar More Coalition | 8:11 AM
0 Comments:
Post a Comment
<< Home