Be careful what you ask for, because you just might get it — good and hard.
A group of altruistic, benevolent and well-meaning Nevadans calling themselves the Committee to Raise the Minimum Wage in Nevada has filed a petition with the Nevada Secretary of State’s office that — if it garners enough signatures to be placed on the 2016 ballot and then enough votes at the polls — would nearly double the minimum wage over the next decade.
The petition, filed this past week, would amend the Nevada Constitution to increase the minimum wage to $9.25 an hour upon passage and by 75 cents a year until it reaches $13 an hour, after which it would increase to match any federal minimum wage hike or equal to an increase in the cost of living. The current constitutional minimum wage is $7.25 an hour if health insurance is provided and $8.25 if not.
The petition also states that tips and gratuities shall not be credited as a way to offset the minimum wage and removes the $1 credit for providing health insurance. It also removes the exemption for those under 18 employed part-time by non-profits, but it does allow a lower wage if it is part of a “bona fide collective bargaining agreement” — the usual sop to the unions.
A measure to raise the minimum wage to $9 an hour never made it out of the 2015 Legislature.
The committee must gather 55,000 signatures from across the state to qualify for placement on the ballot.
One of the leaders of the petition drive, Neal Anderson, a Unitarian minister from Northern Nevada, told The Associated Press, “All labor has dignity and therefore we need to value that work. At some point we need to change policy as well, not just provide charity, which is never enough.”
The problem is that study after study has found that raising the minimum wage does not lift more people out of poverty, but rather its net effect is to actually increase the portion of families that are poor and near-poor, according to an analysis of those studies by the Heritage Foundation. This is because a few will see higher income, others will have their work hours reduced and some will drop from minimum wage to zero wage due to layoffs and businesses closing their doors.
The Congressional Budget Office has estimated that if the federal minimum wage were increased to $10.10 an hour — as proposed by President Obama and others — up to a million workers would lose their jobs.
According to the American Enterprise Institute, when the minimum wage rose 41 percent between 2007 and 2009, the jobless rate for 16- to 19-year-olds increased by 10 percentage points, from about 16 percent in 2007 to more than 26 percent in 2009 — even higher for minorities.
These are entry level jobs without which younger Americans cannot build the skills needed to earn higher pay.
Another Heritage study reported that every dollar increase in minimum wage really only raises take-home pay by 20 cents once welfare benefits are reduced and taxes are increased.
Then there are the affects on everyone. A Cato Institute analysis reports that a “comprehensive review of more than 20 minimum wage studies looking at price effects found that a 10 percent increase in the U.S. minimum wage raises food prices by up to 4 percent and overall prices by up to 0.4 percent.”
Victor Joecks, executive vice president of the Nevada Policy Research Institute, has warned that this proposal is not only anti-business, but anti-worker as well.
“Ultimately, it is the workers who get paid the least that will suffer the most from hikes in the minimum wage — with many of them losing their jobs as businesses close or turn to automation to replace entry-level jobs,” Joecks writes on the NPRI website. “The primary value of entry-level jobs is that they allow workers to gain basic employment skills, which in turn allows them to earn higher wages in the future. Raising the minimum wage, however, makes it harder for low skill workers to get those first jobs. Having that first job is crucial, because two-thirds of minimum wage workers earn a raise within a year.”
He points out that Nevada teenage unemployment already is 23.6 percent.
If this petition is successful it could put countless Nevadans on the dole for life.
Thomas Mitchell is a longtime Nevada newspaper columnist. You may email him at thomasmnv@yahoo.com. He also blogs at http://4thst8.wordpress.com/.
Mr. Mitchell, instead of far right sources you quote – CATO, Heritage etc, – the only ones who would publish such drivel – are some FACTS from the US Department of Labor:
“Minimum Wage Mythbusters”
Myth: Raising the minimum wage will only benefit teens.
Not true: The typical minimum wage worker is not a high school student earning weekend pocket money. In fact, 89 percent of those who would benefit from a federal minimum wage increase to $12 per hour are age 20 or older, and 56 percent are women.
Myth: Increasing the minimum wage will cause people to lose their jobs.
Not true: In a letter to President Obama and congressional leaders urging a minimum wage increase, more than 600 economists, including 7 Nobel Prize winners wrote, “In recent years there have been important developments in the academic literature on the effect of increases in the minimum wage on employment, with the weight of evidence now showing that increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers, even during times of weakness in the labor market. Research suggests that a minimum-wage increase could have a small stimulative effect on the economy as low-wage workers spend their additional earnings, raising demand and job growth, and providing some help on the jobs front.”
Myth: Small business owners can’t afford to pay their workers more, and therefore don’t support an increase in the minimum wage.
Not true: A July 2015 survey found that 3 out of 5 small business owners with employees support a gradual increase in the minimum wage to $12. The survey reports that small business owners say an increase “would immediately put more money in the pocket of low-wage workers who will then spend the money on things like housing, food, and gas. This boost in demand for goods and services will help stimulate the economy and help create opportunities.”
Myth: Raising the federal tipped minimum wage ($2.13 per hour since 1991) would hurt restaurants.
Not true: In California, employers are required to pay servers the full minimum wage of $9 per hour — before tips. Even with a 2014 increase in the minimum wage, the National Restaurant Association projects California restaurant sales will outpace all but only a handful of states in 2015.
Myth: Raising the federal tipped minimum wage ($2.13 per hour since 1991) would lead to restaurant job losses.
Not true: As of May 2015, employers in San Francisco must pay tipped workers the full minimum wage of $12.25 per hour — before tips. Yet, the San Francisco leisure and hospitality industry, which includes full-service restaurants, has experienced positive job growth this year, including following the most recent minimum wage increase.
Myth: Raising the federal minimum wage won’t benefit workers in states where the hourly minimum rate is already higher than the federal minimum.
Not true: While 29 states and the District of Columbia currently have a minimum wage higher than the federal minimum, increasing the federal minimum wage will boost the earnings for nearly 38 million low-wage workers nationwide. That includes workers in those states already earning above the current federal minimum. Raising the federal minimum wage is an important part of strengthening the economy. A raise for minimum wage earners will put more money in more families’ pockets, which will be spent on goods and services, stimulating economic growth locally and nationally.
Myth: Younger workers don’t have to be paid the minimum wage.
Not true: While there are some exceptions, employers are generally required to pay at least the federal minimum wage. Exceptions allowed include a minimum wage of $4.25 per hour for young workers under the age of 20, but only during their first 90 consecutive calendar days of employment with an employer, and as long as their work does not displace other workers. After 90 consecutive days of employment or the employee reaches 20 years of age, whichever comes first, the employee must receive the current federal minimum wage or the state minimum wage, whichever is higher. There are programs requiring federal certification that allow for payment of less than the full federal minimum wage, but those programs are not limited to the employment of young workers.
Myth: Restaurant servers don’t need to be paid the minimum wage since they receive tips.
Not true: An employer can pay a tipped employee as little as $2.13 per hour in direct wages, but only if that amount plus tips equal at least the federal minimum wage and the worker retains all tips and customarily and regularly receives more than $30 a month in tips. Often, an employee’s tips combined with the employer’s direct wages of at least $2.13 an hour do not equal the federal minimum hourly wage. When that occurs, the employer must make up the difference. Some states have minimum wage laws specific to tipped employees. When an employee is subject to both the federal and state wage laws, he or she is entitled to the provisions of each law which provides the greater benefits.
Myth: Increasing the minimum wage is bad for businesses.
Not true: Academic research has shown that higher wages sharply reduce employee turnover which can reduce employment and training costs.
Myth: Increasing the minimum wage is bad for the economy.
Not true: Since 1938, the federal minimum wage has been increased 22 times. For more than 75 years, real GDP per capita has steadily increased, even when the minimum wage has been raised.
Myth: The federal minimum wage goes up automatically as prices increase.
Not true: While some states have enacted rules in recent years triggering automatic increases in their minimum wages to help them keep up with inflation, the federal minimum wage does not operate in the same manner. An increase in the federal minimum wage requires approval by Congress and the president. However, in his call to gradually increase the current federal minimum, President Obama has also called for it to adjust automatically with inflation. Eliminating the requirement of formal congressional action would likely reduce the amount of time between increases, and better help low-income families keep up with rising prices.
Myth: The federal minimum wage is higher today than it was when President Reagan took office.
Not true: While the federal minimum wage was only $3.35 per hour in 1981 and is currently $7.25 per hour in real dollars, when adjusted for inflation, the current federal minimum wage would need to be more than $8 per hour to equal its buying power of the early 1980s and more nearly $11 per hour to equal its buying power of the late 1960s. That’s why President Obama is urging Congress to increase the federal minimum wage and give low-wage workers a much-needed boost.
Myth: Increasing the minimum wage lacks public support.
Not true: Raising the federal minimum wage is an issue with broad popular support. Polls conducted since February 2013 when President Obama first called on Congress to increase the minimum wage have consistently shown that an overwhelming majority of Americans support an increase.
Myth: Increasing the minimum wage will result in job losses for newly hired and unskilled workers in what some call a “last-one-hired-equals-first-one-fired” scenario.
Not true: Minimum wage increases have little to no negative effect on employment as shown in independent studies from economists across the country. Academic research also has shown that higher wages sharply reduce employee turnover which can reduce employment and training costs.
Myth: The minimum wage stays the same if Congress doesn’t change it.
Not true: Congress sets the minimum wage, but it doesn’t keep pace with inflation. Because the cost of living is always rising, the value of a new minimum wage begins to fall from the moment it is set.
You really ought to broaden your list of sources. If you limit your research to far right propaganda outlets all you will get are far right talking points!
Both sides discus impacts of a higher minimum wage on workers of all ages, as well as effects on the national economy. However, I am a retired worker. I would like to see discussed the impact of higher minimum wages on fixed income retirees. After all, we retirees are a large and growing segment of the national demographic.
All of Mitchell’s “study” sources are conservative; something he hides from his readers. He also misleads the reader on the CBO’s estimate, which concludes that the “central estimate” is only half a million jobs lost, and is more than offset by the additional $31 billion in wages earned by people making a higher wage.
If Mitchell had bothered to look at what the overwhelming number of economists’ studies found, he would have had to tell you something like this:
“Based on the economic multiplier effect that results from putting additional income in the hands of lower-income workers, raising the minimum wage [to $10.10] will likely have a modest but positive impact on job creation, leading to an additional 85,000 net new jobs when fully phased in. Lower-income earners spend their income more immediately, more completely, and more locally, than do higher income earners, and therefore generate more economic activity. Increasing the wages of 27.8 million workers by $35 billion over the phase-in period generates an additional GDP impact of $22 billion.1
“This finding is consistent with the most recent, highly rigorous, peer-reviewed economic literature based on an analysis of real-world minimum wage increases across counties on state borders that shows essentially no disemployment effect resulting from raising the minimum wage. 2
1 — http://www.epi.org/publication/raising-federal-minimum-wage-to-1010/
2 — http://www.irle.berkeley.edu/workingpapers/157-07.pdf