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Oregon 15-Cent Minimum Wage Increase Still Not Enough to Make Ends Meet

Published on December 26 by Oregon Center For Public Policy
The increase set to take effect on January 1 will put Oregon’s minimum wage at $9.10 per hour. The change is the result of a ballot measure, enacted by voters in 2002, requiring that the state’s minimum wage keep up with the cost of living.

fs20121011_poverty_graph2_largeThe Oregon Center for Public Policy estimated that it would take at least a minimum wage of about $9.55 to lift a family of three with one parent working full-time out of poverty in 2014. This figure is based on the Center’s projection of how much the federal poverty guidelines are likely to increase next year.

“Despite the federal poverty level being a very low bar, the minimum wage is still sometimes not enough to lift a family above that level,” said Gettel. “The official definition of poverty really measures serious economic privation, not basic needs.”

To achieve a secure, yet modest, living standard, families in Oregon need income that is at least two-and-a-half times the federal poverty level, according to analysis by the Economic Policy Institute, a Washington, D.C.-based think tank. That would mean a wage of about $24 per hour for a single parent with two children.

Over the past year, fast food workers in cities across the country have held one-day strikes in an effort to pressure the industry to raise wages to at least $15 an hour. These strikes have boosted efforts to raise the minimum wage.

A $15 minimum wage may soon become a reality for some workers in SeaTac, Washington. In November voters in the city approved a ballot measure raising the minimum wage for hospitality and transportation workers to $15 an hour. Opponents, however, have sued to strike down the law.

In nearby Seattle, the incoming mayor has convened a task force to study raising the city’s minimum wage up to $15 an hour.

Without specifying a figure, Washington Governor Jay Inslee has called for a discussion on raising the state’s minimum wage — already the nation’s highest among all states. It is set to increase to $9.32 an hour in 2014.

Just last week, the city council of Washington, D.C. unanimously approved an increase in the city’s minimum wage to $11.50, starting in 2016. After that, minimum wage workers will receive yearly cost of living increases.

The minimum wage is also going up in California. Earlier in the year lawmakers enacted a bill raising the minimum wage to $10 an hour by 2016, getting there in two steps.

Oregon’s minimum wage isn’t likely to surpass the $10-mark until at least 2018, Gettel noted. “Unless inflation rises more rapidly than expected, it will be about five years before we hit $10 per hour.”

“In 2002, Oregon voters rightly bumped up the state’s minimum wage and made sure that it wasn’t eroded by inflation,” said Gettel. “Now another increase to the minimum wage would help many more working families make ends meet.”

As workers across the country call for a higher wage floor, research shows that modest increases in the minimum wage do not dampen job creation, the main concern voiced by opponents of an increase.

“The weight of . . . evidence points to little or no employment response to modest increases in the minimum wage,” concluded a report released earlier this year by the Center for Economic and Policy Research, a Washington, D.C. think tank. Their report reviewed two decades of research on the impact of minimum wage increases on employment.

“The time may be right for state and local officials in Oregon to consider raising the minimum wage,” said Gettel. “A higher wage floor is an effective anti-poverty strategy, and it can be implemented without affecting the job market.”

The Oregon Center for Public Policy is a non-partisan, non-profit institute that does in-depth research and analysis on budget, tax and economic issues. The Center’s goal is to improve decision making and generate more opportunities for all Oregonians.

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Avatar of MGx Posted by on December 28, 2013. Filed under Oregon. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

2 Responses to Oregon 15-Cent Minimum Wage Increase Still Not Enough to Make Ends Meet

  1. Avatar of TonyCapo

    TonyCapo Reply

    December 30, 2013 at 11:26 am

    Credible economists point to 1973 as the year wages have since flatlined, or worse, for most working people. If a strapping young man fresh out of high-school in 1973 snagged a minimum wage local job here, I believe he was paid $2.25. It was previously $2.10, but was fazed in over 3 years if memory serves me.

    Even so, $2.10 in 1973 would be equivalent to $11.02 in 2013, according to the Bureau of Labor Statistics CPI Inflation Calculator. http://www.bls.gov/data/inflation_calculator.htm

    We need to have a realistic minimum wage in this country. I’d even be an advocate for a minimum guaranteed income for everyone, such as what Switzerland is mulling over. We might as well cut the corporate welfare out of our tax system and give it to those who would actually spend it. If a business cannot support a realistic minimum wage, we don’t need you.

    Use the calculator and do your own math. How have things been going?

  2. wassup Reply

    December 28, 2013 at 8:51 am

    And we wonder why Boeing wants to leave the unions and high wages of Washington for South Carolina or Alabama? Okie Dokie, this sounds good to me. I’ve been poor and while I did not realize that I was poor at the time, I did not like it. Inexperienced, entry level $15 / hour burger flippers will be just the beginning of the end. We’ll need to get the elected federal representatives to pass law that, under threat of penalty of high fines and jail time, every American must “Buy America” supplies and services thereby offsetting the fact that buyers will shop Asian and South America markets where the wage for similar quality work is often less than five dollars a day – not $15 / hour. Of course that would mean different merchandise on every Walmart shelf. And folks, including those high priced burger flippers, may not be able to afford higher priced goods and services after paying higher rates for Nobamacare insurance. We’ll need to pass law that the hourly rate in all states must be the same as the highest of the prevailing state wages. We’ll also need law that causes all employers to have only full time employees so they will get benefits with that $15 / hour. Maybe I should leave this problem for which I am unqualified to solve to SCDC for resolution.

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