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Time For A Raise

For the first time since the recession, the Massachusetts Senate voted 32-7 in favor of bumping up the minimum wage to $11 an hour by July 2016. Senators also voted 31-7 to increase compensation for tipped workers to 50 percent of the minimum wage, 20 percent more than what they currently receive. The bill now goes to the House of Representatives where it is expected to be voted on by January 2014. “The Legislature takes their time to address the issue,” said Lewis Finfer, executive director of the Massachusetts Communities Action Network in Dorchester.He added that political leaders were pressured to implement wage increases in 2006 and 1999 as well. If the bill passes, the new rate would be implemented in three stages beginning with $9 an hour on July 1, 2014. This would be followed by $10 an hour in 2015, then topping out at $11 an hour the next year. The new wage would be adjusted annually for inflation following the final stage.The minimum wage would be $10.72 by now had it kept pace with inflation since the 1968 raise. “Because the value of the minimum wage hasn't kept pace with inflation, a full-time minimum wage worker now makes $5,000 a year less than in 1968,” said Noah Berger, president of the Massachusetts Budget and Policy Center in Boston. Although the current minimum wage exceeds the national requirement by 75 cents, the annual gross income only amounts to $16,640. While this number clears the state’s poverty line by $5,158, it still falls $6,888 shy of the current cost of living. In contrast, $11 an hour would elevate gross earnings to $22,880 per annum. “While our economy has become increasingly productive, wages for middle and low income workers have been stagnant and the value of the minimum wage has declined,” said Berger. Finfer explained that the implementation process is designed to provide workers with better pay without causing employers financial hardship.He added that there are approximately 380,000 Massachusetts residents who earn an average of $10 an hour. Rep. Thomas Conroy (D-Wayland) explained that there are another 94,000 who make exactly $8 an hour with no benefits.He said that this becomes problematic when workers file for state aid, as it thrusts the financial burden on the taxpayers.“A recent Congressional staff report concluded that a hypothetical 200-person Wal-Mart store costs taxpayers an estimated $420,750 per year,” said Conroy.   On a broader scale, he added that 52 percent of the employees in the fast food industry are enrolled in at least one government program at a total cost of $7 billion per annum.   Conroy said that although five years have passed since the last increase, the House and the Senate have pushed for a new wage in prior years. The first act, S.707, filed on Jan. 14, 2009 by Sen. Marc Pacheco (D-Taunton), was specifically aimed at raising the minimum wage to $8.75. The second act, H.2291, was filed by Rep. Antonio Cabral, (D-New Bedford) on Jan. 21, 2011. Conroy said that Cabral’s intention was “to promote the Commonwealth’s economic recovery with a strong minimum wage.” However, neither act ever went to a vote.  Sen. Daniel Wolf (D-Harwich) explained that providing workers with a higher wage would have more than just a financial impact. “Our neighborhoods will be stronger, our middle class will be stronger, our state will be stronger, our moral foundation will be stronger,” said Wolf. “All of us will be stronger.”  Conroy said that if the House does not vote by May, the bill would be decided by a popular vote in November. According information released by Raise Up Massachusetts in Dorchester, 269,059 signatures have been received to put minimum wage on the ballot next year.In addition, 56 businesses have expressed their support for a higher minimum wage. Some of these companies include Just Works Consulting in Watertown, Harrison-Banks in Newton, Boston Organics in Charlestown and Boston Green Building in Allston.   Finfer explained that although there are several employers who back the new rate, there are also those who oppose it. As a result, he said those business owners tend to sway legislators against the bill to avoid higher payroll costs. “Clearly major employers of low wage earners organize to convince legislators to not take action on this,” he said. Sen. William Brownsberger (D-Belmont) explained that the $11 wage would make employee earnings proportionate to employer payroll. He added that although the House has the authority to present a different figure, both legislative branches would have to negotiate and vote on a new wage.“Eleven dollars was perceived as a balance between helping people with jobs make more, but also not raising it so much that employers won't hire anyone,” said Brownsberger. 


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