Push to hike min­i­mum wage grows as work­ers’ ranks swell

With many more low­er­paid work­ers in to­day’s econ­omy, some call for a higher ‘liv­able wage.’

Austin American-Statesman - - BUSINESS - By Alana Se­muels and Ri­cardo Lopez Los An­ge­les Times

Be­fore the re­ces­sion, Amie Craw­ford was an in­te­rior de­signer, earn­ing $50,000 a year pat­tern­ing baths and cab­i­nets for ar­chi­tec­tural firms.

Now, she’s a “team mem­ber” at the Protein Bar in Chicago, where she makes $8.50 an hour, slightly more than min­i­mum wage. Craw­ford, now 56, says she needed to take the job to stop the hem­or­rhag­ing of her re­tire­ment ac­counts.

Craw­ford is also work­ing with a Chicago group called Ac­tion Now, which is stag­ing protests to raise the min­i­mum wage in a state where it hasn’t been raised since 2006.

“Thou­sands of work­ers in Chicago, let alone in the rest of the coun­try, de­serve to have a liv­able wage, and I truly be­lieve that when some­one is given a liv­able wage, that is go­ing to bol­ster growth in com­mu­ni­ties,” she said.

If it seems that sit­u­a­tions such as Craw­ford’s are more preva­lent th­ese days, it might be be­cause there are more work­ers in lower-paying jobs than there were a few years ago. Of the 1.9 mil­lion jobs cre­ated dur­ing the re­cov­ery, 43 per­cent have been in the low-wage in­dus­tries of re­tail, food ser­vices and em­ploy­ment ser­vices, ac­cord­ing to a study

by An­nette Bern­hardt, pol­icy co-di­rec­tor of the Na­tional Em­ploy­ment Law Project in New York.

At the same time, many work­ers are ex­pe­ri­enc­ing sig­nif­i­cant earn­ings losses af­ter tak­ing a new, lower-paying job. About one-third of the 3 mil­lion work­ers who lost their jobs from 2009 to 2011 and then reem­ployed said their earn­ings dropped 20 per­cent or more, ac­cord­ing to the Bureau of La­bor Statis­tics.

The rise of low-paying jobs in the re­cov­ery, ex­perts said, has cut the spend­ing power of peo­ple who once worked in mid­dle-class oc­cu­pa­tions.

“You see work­ers trad­ing down their liv­ing stan­dards,” said Joseph Brusue­las, a se­nior econ­o­mist for Bloomberg who stud­ies the U.S. econ­omy. Now, Brusue­las said, there’s an over­sup­ply of work­ers and they’re will­ing to take any job in a slug­gish econ­omy. That in­cludes tem­po­rary jobs with­out ben­e­fits and min­i­mum-wage po­si­tions.

Ef­forts to in­crease wages for th­ese work­ers are sput­ter­ing in an era of aus­ter­ity when busi­nesses say they are barely hir­ing, much less paying work­ers more.

The New Jersey state leg­is­la­ture sent Gov. Chris Christie a bill to raise the state’s min­i­mum wage to $8.50 an hour from the fed­eral min­i­mum of $7.25 this month, but he hasn’t signed it and has sig­naled he might not. An ear­lier ef­fort in New Jersey to tie the min­i­mum wage to the con­sumer price in­dex was ve­toed by the gov­er­nor.

Law­mak­ers in Illi­nois are also try­ing to push a bill that would in­crease the min­i­mum wage, af­ter an ear­lier ef­fort this year failed. The Leg­is­la­ture last voted to raise its min­i­mum wage in 2006, be­fore the re­ces­sion, and the gov­er­nor agreed.

“A higher min­i­mum wage means a per­son has to pay more for each worker,” said Ted Dabrowski, vice pres­i­dent of pol­icy at the Illi­nois Pol­icy In­sti­tute, which op­poses rais­ing the min­i­mum wage.

“Com­pa­nies have a few choices — in­crease prices, re­duce the num­ber of peo­ple they hire, cut em­ployee hours or re­duce ben­e­fits. When em­ploy­ees be­come too ex­pen­sive, they have no choice but to re­duce the num­ber of work­ers.”

The Cen­ter for Eco­nomic and Pol­icy Re­search in Washington, how­ever, says there is lit­tle in­di­ca­tion from eco­nomic re­search that in­creases in the min­i­mum wage lead to lower em­ploy­ment, and, be­cause higher wages mean work­ers have more money to spend, em­ploy­ment could in­crease.

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