When Minimum Isn’t Maximum

Published: 7/7/2017

When Minimum Isn’t Maximum

The minimum wage in Los Angeles County went up on July 1. No, I’m not kidding, it increased to $12/hour for employers with more than 25 employees. Now, I could show my age and talk about how I earned well under $4/hour…guess I just did that. Well, at that time, the minimum wage was certainly not called a living wage and I probably didn’t know a single person over the age of 20 making minimum wage at the time. The minimum wage went into effect in 1938 with the passage of The Fair Labor Standards Act. At that time, it was set at $.025/hour. President Roosevelt’s law also included provisions for worker safety and youth employment. If you’ve studied history at all, you know that these laws were intended to help America’s workers. I’m not sure FDR would even recognize how his law’s minimum wage has grown. In 2013, about 1.5 million workers in the U.S. earned exactly the federal minimum wage. Go back to 1979 and 13% of U.S. workers made the minimum wage, which fell to 4% in 2013. Where are most of the minimum wage workers located? Well, nearly half are in the South and a quarter in the Mid-West, with the Northeast and the West trailing behind at nearly the same rate. The states with the highest percentage of workers earning minimum wage were in Tennessee and Idaho and those with the lowest percentage are Oregon, California, and Washington.

A study was recently released about the impact of the minimum wage increase in Seattle, and the findings seem to show that the increase might be hurting those it was designed to help. The University of Washington research showed that businesses, now faced with increased labor costs, actually cut hours. Economists have long argued how a drastically minimum wage increase would impact business and labor, and now the data collected in Seattle will demonstrate what that impact actually is. It will be interesting to see, I just hope businesses can stay in afloat and don’t end up as a statistic in a study.

Want to join me for breakfast next week? Perfect! The Chamber will be holding one of our fan favorites – Let’s Do Breakfast – on Tuesday, July 11th at Mim’s Café in the Cerritos Town Center. See the info below to RSVP. Looking forward to seeing you there!

Have a great weekend!

Peace,

Scott

scott

Scott Smith 
President/CEO 

Weekly Quote:

Never go to a doctor whose office plants have died. Erma Bombeck

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