Responding to the dual crises of poverty wages for millions of Americans and rising income inequality, today Senator Patty Murray (D.WA) and Representative Robert C. “Bobby” Scott (D. VA) introduced the Raise the Wage Act of 2015, which would gradually raise the federal minimum wage, frozen at $7.25 for six years, to $12.00, index the rate to rise yearly, and eliminate the sub-minimum wage for tipped employees.
Reflecting growing support for more significant action on the minimum wage, the legislation represents a 20 percent increase in the Democrats’ minimum wage proposal from recent years, and would raise pay for 38 million Americans – 10 million more than earlier proposals. It also is the first time that the Democrats have called for eliminating once and for all the widely criticized tipped employee sub-minimum wage, which has been frozen at a paltry $2.13 for more than 20 years.
The National Employment Law Project (NELP) hailed the legislation, noting that its is the strongest bill to increase the minimum wage in decades, and that the passage will improve the lives of close to 38 million struggling low-wage workers and their families. The bill has 159 cosponsors in the House and 33 cosponsors in the Senate.
The following statement can be attributed to Christine Owens, executive director of the National Employment Law Project, which is a leader of the national coalition to raise the federal wage floor:
“Tens of millions of working men and women are putting in long hours and often working multiple jobs, yet they’re struggling to afford life’s basics. Anyone who works for a living should be able to make a decent living from work, but the reality for far too many of America’s workers is that they’re falling farther and farther behind.
“With the economy still tilting toward low-paying jobs, the nation needs bolder action to improve jobs across the bottom of the economy. By calling for a $12.00 minimum wage, the Raise the Wage Act would deliver raises to 38 million Americans — 10 million more than past proposals — and finally catch the minimum wage back up to its level 45 years ago when we had strong growth and low unemployment.”
The Raise the Wage Act of 2015 would raise the federal minimum wage from the current rate of $7.25 to $8.00 an hour the first year, and then by $1.00 a year over the next four years. It would set automatic increases starting in 2021 to keep pace with rising wages overall (i.e., by maintaining a constant ratio with the median wage). The legislation also would gradually phase out the subminimum wage for tipped workers, which has been frozen at $2.13 since 1991.
According to an analysis by the Economic Policy Institute, the Raise the Wage act would deliver a raise to more than one in four workers in the United States, or 37.7 million Americans. This workforce consists not of teens, but almost entirely of adults—nearly 90 percent. The average age of workers who would get a raise is 36; nearly half have some years of college education; and 20 percent hold an associate’s degree or higher. More than one in four are working parents with children, and half have family incomes of less than $40,000 per year.
Higher wages for the nation’s lowest-paid workers would put more money into the pockets of people who would spend that money immediately, boosting demand for goods and services in the economy. An increase to $12 means that workers would see more than $100 billion in increased earnings over the next five years, according to the Economic Policy Institute.
Recent polling reveals broad public support for raising the minimum wage: a January 2015 poll found that 75 percent of Americans support raising the minimum wage to at least $12 by 2020.
Today’s federal minimum wage of $7.25 an hour yields full-time earnings of barely $15,000 a year. Congress has voted to raise the minimum wage only three times in the last 30 years; today, the real value of the minimum wage is 24 percent lower than in 1968.
For Immediate Release: April 30, 2015
Contact: Emma Stieglitz, emmaS@berlinrosen.com, (646) 200-5307