fbpx

Latest Posts

Home

Facebook

Twitter

Search
About

Paychecks were growing before minimum wage hikes

A total of 24 states have increased or plan to increase their minimum wage mandates. However the data shows wages have been rising even before the fight for higher minimum wage movement. Additionally, only a small number of workers are helped by higher minimum wage mandates contrary to common belief.

According to the Census Bureau’s Current Population Survey, only 119,000 workers on average had their pay raised directly by each of the 51 state and local minimum-wage hikes between 2016 and 2019. That’s because even those in the 10th income decile—people who earn less than 90% of their peers—made $467 a week in December 2019. That’s $11.52 an hour, far higher than the federal minimum of $7.25 as well as most state and local minimum wages.

And because minimum wage workers make a very small percentage of workers, minimum wage rises make a miniscule of overall wage changes.

All told, the recent minimum-wage hikes directly increased total wages by $4.2 billion over a three-year period, including for workers whose wages fell somewhere between the old and new minimums. But the increase in wages for production and nonsupervisory workers (those likely to be paid hourly) over that period was $325 billion. So minimum-wage hikes directly accounted for only 1.3% of the total increase in the earnings of hourly workers over that period.

The fact of the matter is minimum wage workers continue to make a smaller and smaller proportion of workers. This is partly due to minimum wage mandates, but mainly because of employers raising wages due to rising productivity. Additionally younger workers entering the workforce (especially employed teenagers between 16 and 19), as well as highly inexperienced and low skilled workers make up a bigger proportion of minimum wage workers. This only goes to show wages go up as workers earn gain more skills and experience.

Comments

Subscribe

Categories

Upcoming Events

  • Morning in Minnesota: St. Cloud

    Location: St. Cloud

    Sign up HERE! Courtyard by Marriott St. Cloud 404 West Saint Germain Street St. Cloud, MN, 56301 Please join Center of the American Experiment on Tuesday, July 21 for breakfast with Center policy fellow and education expert Catrin Wigfall as she explains K-12 education in the state and its persistent disparities despite decades of increased spending. Following her presentation, Catrin will lead a Q&A session. 7:30 AM Check In and Breakfast 8:00 AM Presentation 9:00 AM Conclude   Catrin Wigfall is a Policy Fellow at Center of the American Experiment. She is also the director of EducatedTeachersMN and EmployeeFreedomMN. Catrin’s…

    Register Now
  • Kristi Noem: The Courage to Reject a Shutdown

    Location: Online

    Sign up HERE! Join us Wednesday, July 8th for an interview with South Dakota Governor Kristi Noem over Zoom. In response to COVID-19, Noem defied the norm of a statewide shutdown and let South Dakotans choose for themselves what safety precautions to take. Tune in to this live online event to hear how Governor Noem preserved her state’s economy while still keeping citizens safe. Wednesday, July 8th at Noon CT Sign up HERE!  

    Register Now
  • Morning in Minnesota: Marshall

    Location: Marshall Golf Club

      Sign up for this event HERE! Please join Center of the American Experiment on Thursday, July 16 at Marshall Golf Club for a breakfast with Center economist, John Phelan, as he discusses Minnesota’s economic future. Following his presentation, John will lead a Q&A session. 7:30 AM Check In and Breakfast 8:00 AM Presentation 9:00 AM Conclude John Phelan is a graduate of Birkbeck College, University of London, where he earned a BSc in Economics, and of the London School of Economics where he earned an MSc. He worked in finance for ten years before becoming a professional economist. He…

    Register Now