Kimberly Baker did everything right. She was at the top of her high school class and began working at the age of seventeen in a grocery store in Lincoln, Nebraska. She completed a degree in foreign languages while working full time in the insurance industry. But despite her skills and perseverance, the thirty-eight-year-old single mother earns only $13.26 an hour, too little to rent a modest apartment.
“I get by because my sixteen-year-old son and I live with my parents, retired nurses who own their home,” Baker says. “Although I supplement my earnings in the insurance industry by working as a tutor of Latin and a translator of French, it is impossible for me to take vacations or to save for my son’s college education or a master’s degree that would enable me to land a job in a better-paying industry.”
Baker’s experience is common, says Ben Zipperer, an economist at the Economic Policy Institute (EPI), a think tank that studies the impact of economic trends on workers.
“Unfortunately, low wages are widespread throughout the labor market,” he tells The Progressive. “It is not just a problem of a teenager working after school to earn spending money, but an enormous burden for adults working two or three jobs for substandard wages that barely keep food on the table.”
About one-third of the U.S. workforce—fifty-two million people—earn less than $15 an hour, according to Oxfam America. Eighty-nine percent of the workers whose annual pay is less than $31,200 are aged twenty or older, its March 2022 report found.
Women and people of color are disproportionately affected by low wages. Twenty-five percent of American men earn less than $15 an hour, while 40 percent of women do. That figure is 27 percent for white workers, compared with 46 percent of Latinx workers and 47 percent of Black workers.
“The problem is severe because the federal minimum wage of $7.25 per hour has not been raised in more than sixteen years, and is now worth less in inflation-adjusted terms than at any point since 1956,” Zipperer says. “This is disastrous for workers, because EPI’s family budget calculator shows that there is no place in the nation where a single adult without children can achieve an adequate standard of living with wages of less than $15 an hour.”
But the good news is that the movement to ensure a livable wage for all Americans is gaining momentum. The Fight for $15, which began in 2012 with fast-food restaurant workers in New York City, is raising the wages of workers in retail, health care, and other fields that have historically been underpaid.
Thirty states, along with Washington, D.C., have increased their minimum wages above the $7.25 federal standard, and nearly fifty cities and counties have higher minimum wages than their states, EPI data shows.
“Equally important for those who struggle to afford basic necessities, nineteen states and Washington, D.C., now have laws requiring that the minimum wage be automatically indexed for inflation each year,” Zipperer says.
Seven states have eliminated the subminimum wage, which allows employers to pay tipped workers as little as $2.13 an hour. Customers’ tips are excluded from the calculation of the federal minimum wage of $7.25 or the higher state minimums. In these places, employers pay the full wage, enabling workers to retain their tips.
Raising the minimum wage helps low-wage workers acquire wealth so that they can achieve long-term goals like buying a home or saving for retirement.
Worker wealth grew by 74 percent in states that raised the minimum wage between 2013 and 2019—and median net worth increased 174 percent among Black people or 211 percent among Latinx people.
“From 2013 to 2019, worker wealth grew 74 percent in states that raised their minimum wages compared to 55 percent in states that retained the federal minimum wage,” explains Yannet Lathrop, a senior researcher at the National Employment Law Project (NELP) and co-author of the November 2022 report “Ten-Year Legacy of the Fight for $15 and a Union Movement.”
“The impact on people of color was significant: The median net worth of Black people increased 174 percent and 211 percent among Latin[x] people,” she tells The Progressive.
In addition to blue states like California, Illinois, and Massachusetts, which have a history of worker protections, minimum wage proposals have also passed in red states that champion free-market policies, like Missouri, Montana, and South Dakota.
In November 2022, more than 58 percent of voters in Nebraska—a state that rarely votes for Democrats in presidential elections—approved an increase in its minimum wage. To give employers sufficient time to adjust, the measure gradually increases the wage from $9 an hour until it reaches $15 an hour by 2026. The law includes a provision for automatic increases for inflation after that.
Minimum wage measures enjoy wide public support, but getting them on the ballot is difficult, says Ken Smith, director of the economic justice program at Nebraska Appleseed Center for Law in the Public Interest. To do so, Smith and others established a broad coalition of organizations to highlight the detrimental effects of low wages on individuals and families as well as businesses across the state.
In addition to the Nebraska State AFL-CIO and the NAACP Lincoln Branch, the Raise the Wage Nebraska coalition included Planned Parenthood Advocates, Heart Ministry Center (the state’s largest food bank), and civic groups like the League of Women Voters and the Holland Children’s Movement, which works to prioritize children and families in state budgets.
To overcome the widespread assumption that a minimum wage worker could live on $1,000 a month, the coalition cited the experiences of Nebraskans like Hannah Robinson, who worked sixty hours a week but couldn’t afford basic necessities.
“Working every waking hour with only a break to take the bus from one job to another affected me emotionally,” she says. “It caused me anxiety—I had no time or energy to pursue any interests at all.”
The support of more than 300 small business owners across the state helped the coalition refute claims that raising the minimum wage would ruin the state’s economy.
“Raising the minimum wage is a win/win for businesses and workers,” Dave Titterington, owner of Wild Bird Habitat Stores in Lincoln and Omaha, says in a press release. “When you pay employees a living wage, they’re happier, they’re more dedicated, and they’re more productive. And raising the minimum wage will enable workers to spend more at local businesses all across Nebraska.”
The Open Sky Policy Institute, a nonpartisan organization that does fiscal research, estimated that the initiative will increase wages for about 30 percent of Nebraskans. More than 20 percent of Nebraska workers currently make less than $15 an hour. Almost 9.6 percent make slightly more than $15 and likely would receive a pay increase as businesses work to retain and recruit workers.
More than 10,000 residents, including 3,500 children, would be lifted out of poverty, and people of color would be the most affected, the institute noted.
Opponents wasted no time in fighting the measure. In January, Republican state Senator Tom Briese introduced a bill to set the minimum wage of fourteen-to-seventeen-year-olds at $9 an hour this year with gradual increases to $10 by 2026. The proposed legislation also calls for a training wage for eighteen-to-nineteen-year-olds, which would start at $9.25 in 2023, increase to $10 an hour by 2026, and continue at 75 percent of the regular minimum wage.
State Senator Megan Hunt, a Democrat who supported the ballot initiative, anticipated the backlash. “Ideological opposition [to the minimum wage increase] is a major factor,” she says. “Some opponents take the laissez faire position that there should be no pay standards, while others push for exemptions for certain classes of workers. Although studies have shown that businesses in other states have prospered after their minimum wages increased, some employers continue to claim that paying their workers a few dollars more over a period of years will drive them out of business.”
As in Nebraska, labor advocates in Washington, D.C., have overcome numerous hurdles in their quest to fundamentally change the way employers pay tipped workers. In November 2022, 74 percent of voters in the nation’s capital elected to eliminate the two-tiered minimum wage system, which affects workers in the city’s hospitality and service industries.
The current minimum wage for tipped workers of $5.05 per hour will gradually increase to match the minimum wage of nontipped workers by 2027.
Ryan O’Leary, who proposed the initiative as part of the D.C. Committee to Build a Better Restaurant Industry, said the campaign is about more than eliminating the subminimum wage.
“It is about promoting justice for vulnerable workers who have been exploited for centuries,” he tells The Progressive. “Tipping started after Emancipation, when restaurants began to hire newly freed slaves—mostly Black women—and have them 100 percent dependent on tips.”
Over the years, abuses like sexual harassment have flourished in restaurants, nail salons, and other places where employees are expected to be friendly and receive tips, O’Leary says.
A study published in May 2018 by Restaurant Opportunities Centers (ROC) United, a nonprofit that advocates for better working conditions for restaurant workers, found that the majority of respondents who reported having experienced sexual harassment attributed it to their dependency on tips.
“Winning support among restaurant workers was an uphill fight, because management has total control over their lives. Single parents are too afraid to speak up when managers change their shifts on a moment’s notice.”
“Winning support among restaurant workers was an uphill fight, because management has total control over their lives,” O’Leary says. “The waitstaff doesn’t know from week to week how much they will earn, so single parents are too afraid to speak up when managers change their shifts on a moment’s notice.”
In addition to alleviating workers’ feelings of powerlessness, the campaign overcame efforts by the D.C. Council to impede reform, O’Leary says. After overturning the initiative in 2018, the council passed compromise legislation to assuage workers’ concerns about wage theft. The law required employers of tipped workers to report certain wage data to a city agency that would identify whether workers were in fact being paid at least the minimum wage.
But that didn’t happen, O’Leary, a former waiter, explains. An October 2022 analysis by DC Jobs with Justice and ROC-DC found that 64 percent of bars and restaurants with liquor licenses—922 businesses in Washington, D.C.—had failed to report the data. The restaurant industry attributed the widespread noncompliance to the city’s slow rollout of the system.
“Implementation of the [latest ballot initiative] is scheduled to begin May 1,” O’Leary says. “We hope our four-year fight will encourage other campaigns to try and try again.”
Other states took steps to lift workers out of poverty in November 2022. Nevada eliminated its two-tiered minimum wage system when voters passed a $12-per-hour minimum wage to take effect July 1, 2024. For nearly two decades, employers that provided health benefits to workers were permitted to pay them $1 less per hour than employers that did not offer such benefits.
In Tukwila, Washington, 82 percent of voters chose to raise the city’s minimum wage, enabling it to compete with nearby Seattle and the city of SeaTac, which have higher minimums, for workers at shopping malls and franchise businesses.
Tukwila employers with more than 500 employees worldwide will increase starting pay from $14.49 an hour to $18.99 an hour in July. Depending on their size, other employers would gradually raise their rates until catching up with the larger employer rate in 2025.
And in Inglewood, California, voters approved a measure to raise the minimum wage for workers at privately owned health care facilities to $25 an hour.
A similar proposal failed in nearby Duarte, California, as did a proposal to raise the minimum wage for hotel workers in Laguna Beach, California. A Portland, Maine, ballot measure that would have raised the minimum wage and extended it to tipped workers and independent contractors in that city also failed.
Lathrop, of NELP, predicts that future campaigns will succeed, especially given that “the decade-long fight for $15 an hour has shown that when workers build power together, they move all of us forward.”
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