Sept. 17--California's recent decision to raise its minimum wage to $10 an hour by 2016 -- a higher minimum rate than any other state has now -- may add momentum to the drive for higher hourly rates in at least eight other states in 2014.
New Jersey could become the fifth state this year to increase its state minimum wage if voters approve a measure on Nov. 5 that would boost the hourly rate by $1, to $8.25.
In states as varied as Alaska, Idaho, Massachusetts and South Dakota, advocates are pushing to put minimum wage hikes on state ballots in 2014. Meanwhile, elected officials are leading the charge in Hawaii, Illinois, Maryland, Minnesota, and the District of Columbia.
The action at the state level comes as organized labor and liberal groups have backed a wave of strikes by fast-food workers in cities across the country to put a spotlight on hourly wages. Advocates are pressing for a national $15 hourly wage, more than twice the $7.25 federal minimum wage.
States cannot set a minimum wage that is lower than the federal standard, but they are free to establish a higher one. Washington state currently has the highest state minimum wage at $9.19; followed by Oregon ($8.95) and Vermont ($8.60). Connecticut, the District of Columbia and Illinois all have a state minimum of $8.25. In addition, some 120 cities have enacted "living wages" that set a minimum standard for businesses that receive city contracts. City minimums range from $9 to $16 an hour.
Under California's plan, the state minimum wage would rise from $8 an hour to $9 an hour on July 1, 2014, and then jump again to $10 an hour on Jan. 1, 2016. Less than 2 percent of California workers who receive an hourly wage make the federal minimum of $7.25 or less (some seasonal employees and other workers are can be paid less than the minimum wage). The state with the highest proportion of minimum wage workers is Idaho, with nearly 8 percent, according to the U.S. Bureau of Labor Statistics.
California's passage of a $10 minimum wage "will set the bar for what other states will aim for," said Paul Sonn, legal co-director of the National Employment Law Project (NELP), an organization that spearheads a Raise the Minimum Wage campaign.
Momentum at the state level is increasing as efforts to increase the federal hourly wage have gone nowhere. Congress last raised the minimum wage in 2007. Democrats in Congress have called for raising the federal minimum wage to $10.10 per hour by 2015, higher than President Barack Obama's call for a $9 hourly wage, but it's unlikely the GOP-controlled House will approve it.
"Once again, California is leading the effort to rebuild our middle class," California Assemblyman Luis Alejo, a Democrat, said after the Assembly approved his bill to increase the minimum wage.
Raising the minimum wage is a politically polarizing issue. President Obama and other proponents of a higher federal minimum wage say that while companies are making record profits, the lowest-paid workers have seen their purchasing power plummet because the federal wage floor hasn't kept pace with inflation. If it had, the hourly rate would be $10.74. They say raising the minimum wage will give the economy a boost by putting more money into the pockets of people who are likely to spend it.
But opponents, including Republican House Speaker John Boehner and many business groups, argue that employers won't be able to afford the higher hourly wage and will have to lay off workers. Most businesses that hire minimum wage workers are not big corporations, they say, but rather independently-owned franchises and small businesses that operate on narrow profit margins.
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