In First Week of 2015, Minimum Wage to Rise in 21 States

Walmart workers have held protests to call for higher wages. (AP Photo/J Pat Carter) (Photo: J Pat Carter, AP)
Walmart workers have held protests to call for higher wages. (AP Photo/J Pat Carter)
(Photo: J Pat Carter, AP)

The minimum wage will rise in 21 states in 2015, putting it above the federal pay floor in more than half the USA and highlighting the impact of a national movement to boost the earnings of low-paid workers.

The increases will lift the hourly wages of 2.4 million workers by up to $1 to an average of $8 and a high of $9.15, according to the Economic Policy Institute. The federal hourly minimum is $7.25.

Another 1.9 million workers are expected to benefit from a higher pay scale. The post-Christmas gifts will pump about $1.5 billion into the U.S. economy because low-wage workers tend to spend most of their paychecks, the liberal think tank estimates.

“It’s not going to bring them a life of luxury, but it’s a substantial amount of money for somebody struggling to get by,” says EPI senior economic analyst David Cooper. “They can make payment plans for a car or buy some extra groceries. ”

Four of the states — Alaska, Arkansas, Nebraska and South Dakota — approved ballot initiatives in November to increase the minimum wage.

Eight states — Connecticut, Hawaii, Maryland, Massachusetts, New York, Rhode Island, Vermont and West Virginia — passed legislation the last two years.

Minimum pay will rise more modestly in nine other states as a result of automatic cost-of-living increases. All of the increases will take effect Jan. 1, except in New York, where it will kick in a day earlier.

By early next year, 29 states with 60% of the U.S. work force will have minimum wages higher than the federal government’s, according to EPI and the National Employment Law Project.

A bill, backed by President Obama, to raise the federal minimum to $10.10 an hour is stalled in Congress amid Republican opposition.

Cooper partly attributes the state action to nationwide strikes by fast food workers demanding raises to at least $15 an hour. Data from payroll processor ADP shows that state minimum wage hikes have helped bring low-wage workers faster earnings growth than higher-paid employees this year.

Critics, including the restaurant industry, say they force employers to hire less or cut employees’ hours.

Wal-Mart spokeswoman Brooke Buchanan said the retail giant won’t raise prices because it “can absorb these costs.”

SOURCE: USA Today – Paul Davidson

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