Raising the Minimum Wage

The middle class is shrinking as high-paying jobs are replaced with low-paying jobs
New job growth over the past few years has been driven disproportionately by industries with median wages below $15 per hour, with the top three occupations in job-growing industries being retail sales, cashiers and food preparation workers - occupations that all pay less than $10 per hour.

The highest percentage of Americans with low-paying jobs are adults - not teenagers
76 percent of workers who earn minimum wage are over the age of 20. 26 percent of our workforce, or 35 million Americans, earn less than $10.55 an hour.

The current minimum wage has not kept up with inflation
Had the minimum wage held pace with the rate of inflation since 1968, it would currently be more than $10 per hour. The fact that it hasn't is a key factor to the increasing economic inequality of the past 30 years.

Increasing the minimum wage boosts consumer spending and the economy
Consumer spending comprises 70 percent of gross domestic product, and working families spend higher wages at local businesses, re-circulating money through the economy. In fact, every $1 in wage increase for minimum-wage workers results in $3,500 in new consumer spending by that household over the next year.

A higher minimum wage does not cause job loss
Over almost two decades, studies of employment levels before and after minimum wage increases have found that minimum wage increases did not lead to job loss, even during periods of high unemployment.

A higher minimum wage benefits employers by reducing employee turnover and increasing employee productivity
Increased wages result in decreased employee turnover and increased productivity, saving employers money by reducing substantial recruitment, retraining and re-staffing costs. And since all companies are required to pay the same minimum wage upon its increase, no company is left at a competitive disadvantage. Many businesses across the country are in favor of a strong minimum wage and recognize it as good for business because of the benefits that come with solid financial compensation of employees.

This information was compiled from data provided by the National Employment Law Project (NELP); Briefing Paper, Jan. 2011

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