The Current State of Minimum Wage in America

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Minimum wage in the United States has been a hotly contested issue for awhile now, with many states opting to increase their minimum wage while other states, such as Louisiana and Alabama, lag behind willingly. The map to the right indicates statewide minimum wages to help illustrate the obvious disparity not only between each state, but between state and federal minimum wages as well. 

The Impact of Minimum Wage on Businesses

The lower the minimum wage, the bigger the profit businesses can pocket; so naturally, states with no state-mandated minimum wage will draw in a larger number of businesses--most of whom are looking to increase their profit.

The key? Low minimum wages.

The less a business has to pay out to their employees, the more they’ll make overall. While employees might get stuck with the short end, states gain the presence and tax revenue of more and more businesses looking to capitalize on their stance regarding minimum wage standards.

In 2019 according to ncsl.org, eighteen states including Alaska, Florida, Minnesota, Montana, New Jersey, Ohio, South Dakota, and Vermont increased their minimum wage rates based on cost of living expenses. Ten additional states--Arizona, California, Colorado, Maine, Massachusetts, Missouri, New York, Rhode Island, and Washington--updated their minimum wage rates because of previously passed ballot initiatives and legislation.

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That leaves just under half of the country without improvements to their minimum wage standards. While that means higher pay for employees, businesses can actually benefit from that dip in profit--they gain quality employees. They also gain the sense of satisfaction knowing they are helping the people who help THEM make money to meet basic living needs without living paycheck-to-paycheck.

The Fight for 15

Seven years ago in 2012, a group of fast-food workers in NYC came out and demanded a nearly 100% raise, from $7.25 to $15 an hour. In 2019, more than a million employees in similar jobs will finally be getting that raise.

Meanwhile, plenty of states are still well under the federal minimum of $7.25/hour, particularly for those who work less than 40 hours weekly; some companies even attempt to cut employees off at 35 hours/week to avoid having to offer them benefits entitled to “full time employees”. The disparity is noticed but many states particularly in the southern US have refused or ignored the example being set by the rest of the nation.

The Fight for $15 is ongoing on many states; and even though it may be cheaper to live in certain places, some of those states are still attempting to improve minimum wage to aid employees. It’s been the ‘Fight for $15’ movement that encouraged most states to implement a wage hike, while others have increased minimum wage gradually year by year.

Penal Employment

Penal labor is the other side of the wage disparity where inmates are employed in capitol buildings, and even in governor’s mansions throughout the Southern United States, like Louisiana. However, using prisoners for labor that dips below $1/hour for both unskilled and skilled labor goes beyond the South.

But that’s not the only state using penal labor for cheap labor: Arkansas, Alabama, Missouri, Oklahoma, Nebraska, and Georgia are all responsible for employing inmates in state buildings. These states are not only hindering the average employee’s ability to meet the basic needs and costs of living but are actively contributing to a system that is blatantly reaping the benefits of modern-day slavery.

It’s really no wonder these southern states don’t feel too pressured to change their ways when they’ve been benefiting from such cheap, unethical employment practices for years. And while other states, such as California, have used inmates for labor (as was the case with fighting the 2018 wildfires), those programs were volunteer based and made available due to the overwhelming crisis the state faced regarding wildfire outbreaks.

Of the states who employ prisoner labor, many tout the inexpensive cost of their labor to businesses as a cost-effect labor pool, further encouraging private entities to take advantage of below-average minimum wage areas.

Still, while progress is made across the board, the states in which private entities are able to make a greater profit by paying employees less, or where inmates are used for cheap labor in state buildings, that disparity hints at deeper problems. With states like Alabama, Mississippi and Louisiana having no minimum wage laws, the situation may need more than a good example set by the remainder of the United States to be remedied.

Specific Wage Improvements Show Promise

Outside of hourly minimum wage improvements, states like Illinois have been pushing to increase the minimum salary of its teachers to $40,000. This change not only comes amidst the Fight for $15 but the long-standing fight for teachers to receive fair compensation for a job that’s responsible for educating the country’s young. The state hopes to hit the $40k salary by the 2023-24 school year with the help of a bill sponsored by State Sen. Andy Manar.

The new minimum salary would be a vast improvement to the $9,000-10,000 minimum wage that was set for teachers back in 1980.

The Cost of Living vs. What We’re Paid

One of the most talked about reasons for needing to increase the minimum wage country-wide is the rising cost of living. Where most income is invested in rent, employees making below state or federal minimum wage--or even those benefiting from increased wages--are still struggling in areas to support themselves.

The country is currently working towards taking better care of its working class citizens, and given how many of the professions affected by abysmal minimum wages are customer service and food industry positions, supporting these employees can help them feel more secure in their ability to take care of themselves financially; but it can also reduce dependence on government assistance for individuals already working one or more jobs just to make ends meet.

Certainly there are many states that have a long way to go to match up to the progress demonstrated by others. Hopefully once the impending consensus of higher and fair minimum wages, both hourly and salary, are reached, the states that are so behind the times will finally get a clue.

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