Debate on MI min. wage continues with new report
As concerns over the livability of a minimum wage income mount, a new Labor Day report from the Michigan League for Public Policy, or MLPP, showed that while wages have gone up for “higher earners,” the majority in the state earn less than they did 40 years ago as a result of inflation.
Many of those eking out low wages are young people, said Peter Ruark, senior policy analyst for the MLPP. Ruark said he suspects a significant number might even be college graduates, though he didn’t have access to supporting data.
“I would think the decline in wages would have a little more effect on people just getting into the workforce,” Ruark said, who’s been with the Lansing-based advocacy group since 2011.
“They’re not employed in their professions yet,” he said, referring to students and recent graduates. “They’re not established. There are some fields where jobs were plentiful back a decade ago, like teaching in Michigan.”
But with fewer jobs available, many young workers end up settling for a lower-paying compromise to pay the bills.
Seven dollars and forty cents an hour — that’s the minimum wage in Michigan. Do the math, and that comes to $13,675.31 a year, just shy of the federal poverty level of $11,490 for a single adult household in 2013.
Many liberal advocates in Michigan say it’s time to raise the minimum wage to $10 an hour. As President Barack Obama also calls for an increase and fast food strikes break out in Detroit, Flint and Grand Rapids, a wage boost for the lowest earners might be picking up traction.
There are a handful of Michigan proposals to make that happen, although experts said it’s unlikely to pass with a Republican-dominated Legislature.
A February 2013 bill sponsored by Sen. Bert Johnson, D-Detroit, would bump the minimum wage up to $9 an hour by 2016. It’s an incremental approach many Democrats support, including Rep. Sam Singh, D-East Lansing, who is co-sponsoring a similar bill from fellow Democratic Rep. John Switalski.
“Unfortunately the Republicans have not put a strong emphasis on individuals in helping them get living wages,” Singh said.
About 283,000 workers in the state are making less than $10 an hour, according to the MLPP. Data from the Bureau of Labor Statistics shows that nationwide, 3.6 million people are earning minimum wage or less, or about 4.3 percent of the workforce as of 2012.
At the same time, the true value of those earnings continues to decline as inflation rises at the relatively steady rate of 3 percent a year, Ruark said.
Yet critics say increasing the minimum wage could cause employers to hire fewer people.
“If you require employers to pay a higher wage, one of the ways they may pay for that is to increase the costs of goods and services,” said Ari Adler, press secretary for Republican Speaker of the House Jase Bolger.
Adler said he did not have hard data to back up the theory, but believed a change in minimum wage could prevent employers from hiring as many employees as they would like.
“You hear about employers not being able to expand, or hire as many people, or give as many hours,” he said. “We increase the cost of doing business.”
With the GOP supermajority, Adler said it’s unlikely that a minimum wage increase would build much steam.
Megan Steinberg, a sophomore elementary education junior who just landed a $7.40 an hour job at the Student Union cafeteria, said she’s not distraught about her earnings. She also worked a minimum wage job over the summer, but saved money on rent by living at home.
“For me, because I (was) living with my parents, I felt it was enough,” Steinberg said.
But for someone without parents to helping to pay expenses, it would be difficult to scrape by, she said. And with fewer job openings for teachers, she said she may have to accept low wages until a school hires her.