Saturday, July 28, 2007

Minimum Wage, Maximum FUD

Since I've been on hiatus, the minimum wage hike has been in the news. I only have a couple of comments on it by this point, so I'll peg them to this Commercial Appeal editorial from local activist Rebekah Jordan.

She conveniently uses some distorted numbers, for one:
According to the Economic Policy Institute, about 153,000 Tennesseans will directly benefit from the raise, and another 294,000 workers in our state will benefit overall, because of pay raises many companies are likely to make in order to retain workers who are already earning around $7.25 an hour.
The actual numbers of people affected looks more like this:
In truth, very few Tennesseans actually have to live on a wage of $5.15 an hour. Only 1.5% of the state’s workforce—approximately 40,000 workers—is employed at minimum wage levels. Furthermore, the majority of Tennessee’s minimum wage earners are either teenagers living at home and working for weekend pocket money or married individuals working part-time to supplement their spouse’s income....

Of Tennessee’s 40,000 minimum wage earners, fewer than 4,800 are single parents.
Speaking as someone who has worked in the minimum wage world most of his life (both as an hourly and as management) I can tell you that very few fast food workers only get paid the minimum wage. Most wages start at $7 and hour and go up from there. Most warehouse, general labor jobs start at $10, or more.

So why all the self-serving misdirection from folks like Jordan? Simple: election year politics.

Nearly every union in America has its wage structures pegged to the minimum wage. Raise the minimum and you raise their wages. That's where Jordan's numbers come from, union workers who will benefit from the hike.

That's why, in the political announcements last week from legislators on the minimum wage hike, you saw so many union workers sharing the stage and union banners hanging behind podiums. It's all about placating and paying off the base.

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