MassBudget: The Minimum Wage in Massachusetts: Challenges & Opportunities

The Minimum Wage in Massachusetts: Challenges and Opportunities  Over the last 40 years, as productivity has increased steadily and we have created more value per hour worked, that growth has not translated into greater economic security for working people and their families. Wages for most workers have barely grown while the only group to see substantial income growth has been those with the highest incomes.   If the minimum wage had kept pace with productivity growth since 1968 it would be over $18 an hour today - twice its current level in Massachusetts. Increasing the minimum wage towards that level, at least for some larger businesses, could help people who work hard to better support themselves and pay for basic necessities for their families. The Minimum Wage in Massachusetts: Challenges and Opportunities examines long term wage trends and describes some of the ways employers could adjust to a significant increase in the minimum wage. Recent research indicates that when wages for low wage workers are increased, employers see reduced turnover and training costs, higher productivity and morale and they can implement modest price increases. To read the full brief, please click HERE.  The Massachusetts Budget and Policy Center (MassBudget) produces policy research, analysis, and data-driven recommendations focused on improving the lives of low- and middle-income children and adults, strengthening our state's economy, and enhancing the quality of life in Massachusetts. MASSACHUSETTS BUDGET AND POLICY CENTER 15 COURT SQUARE, SUITE 700 BOSTON, MA 02108

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Labor Day 2014: Min Wage to Rise but Challenges Remain

MassBudget    Information.    Participation.  Massachusetts Budget and Policy Center    Democracy. LABOR DAY 2014: Minimum Wage to Rise but Challenges Remain  When we celebrate Labor Day this fall, we will be able to celebrate a meaningful step towards building an economy that works for everyone. Because our state is raising the minimum wage, hundreds of thousands of working people in Massachusetts, and their families, will have a little more economic security. Raising the wages of these low wage workers can also improve overall economic conditions as their families will be able to spend more in the local economy. In Labor Day 2014: Minimum Wage to Rise but Challenges Remain we examine the trends that are shaping the economic lives of working people in Massachusetts. Across the nation, for several decades, we have been drifting away from having an economy that promotes broadly shared prosperity: while productivity has increased, wages for too many workers have not; while income has grown overall, very little of that income growth has gone to low and middle income families.  Many of the challenges we face require national solutions. But there are things we can do right here in Massachusetts, as we saw with the minimum wage increase. We can expand access to high quality education and training - from early education for three and four year olds to ongoing workforce training for adults. We can also improve working conditions for everyone - with policies such as earned paid sick time that would allow workers who are sick or need to care for a sick child to be able to do so without missing a day's pay or risking being fired. Labor Day 2014: Minimum Wage to Rise but Challenges Remain, examines troubling trends over the past several decades. It also describes effective policies that could move our Commonwealth towards a future with greater economic opportunity and security for people in every community in state. To read the report, click HERE.  The Massachusetts Budget and Policy Center (MassBudget) produces policy research, analysis, and data-driven recommendations focused on improving the lives of low- and middle-income children and adults, strengthening our state's economy, and enhancing the quality of life in Massachusetts. MASSACHUSETTS BUDGET AND POLICY CENTER 15 COURT SQUARE, SUITE 700 BOSTON, MA 02108

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MassBudget: Rewarding Work: The Data on an $11 Minimum Wage

MassBudget    Information.    Participation.  Massachusetts Budget and Policy Center    Democracy. Rewarding Work:  The Data on an $11 Minimum Wage Seeking to expand economic opportunity for working people in the Commonwealth, the House and Senate have voted to increase the state's minimum wage to $11 an hour by 2017. This will raise the wages of about 600,000 people who work hard, at low wages, to support themselves and their families. In addition to helping these families and individuals, a minimum wage increase can also have positive effects on the overall economy, as higher wages allow workers to spend more at local businesses. When fully phased in, the increase will raise annual wages for affected workers by approximately $1.1 billion. Who are the 600,000 people whose wages will increase? Together they are one-in-five wage earners in the Commonwealth. Over 85 percent are twenty years old or older -- and younger workers who are helped are often working to pay for college or to help their family with basic expenses. 57 percent are women 140,000 of the affected workers are parents -- and 236,000 children live in households that will be helped by the increase. This legislation would raise the wage in three steps: to $9/hour in 2015, to $10/hour in 2016, and to $11/hour in 2017 (on January 1st of each year). These wage increases would not be indexed to inflation. (For more discussion of indexing, see MassBudget's factsheet Value of Minimum Wage is Eroded Quickly by Inflation.) In addition, the "tipped minimum wage" - which allows employers to pay tipped workers a lower wage (as long as tips bring the workers' pay up to the regular minimum wage) -- would rise slightly, from the current rate of $2.63/hour to a final rate of $3.75/hour, also by 2017. (For more discussion of the tipped minimum wage, see MassBudget's factsheet The Minimum Wage for Tipped Workers.) At $11 and hour in 2017, Massachusetts would have the highest state minimum wage in the nation -- unless other states raise their wage above that level during the next three years. For more information visit our minimum wage resource page . The Massachusetts Budget and Policy Center (MassBudget) produces policy research, analysis, and data-driven recommendations focused on improving the lives of low- and middle-income children and adults, strengthening our state's economy, and enhancing the quality of life in Massachusetts. MASSACHUSETTS BUDGET AND POLICY CENTER 15 COURT SQUARE, SUITE 700 BOSTON, MA 02108

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MassBudget: Steep Decline in Employer Share of Tipped Workers' Wages

MassBudget    Information.    Participation.  Massachusetts Budget and Policy Center    Democracy. The Steep Decline in the Employer Share of Tipped Workers' Wages Tipped workers are among those who have a better opportunity to provide for themselves and their families when the minimum wage is increased. But the minimum wage works differently for these workers, as you can read in the new MassBudget Facts At A Glance "The Steep Decline in the Employer Share of Tipped Workers' Wages." Many of us may assume that tipped workers are paid at least the $8 an hour minimum wage by their employers, and that our tips are on top of that. That's not the case. In Massachusetts, tipped workers can be paid as little as $2.63 an hour by their employer, as long as tips get them to the minimum wage rate. That means that the employer can pay as little as 33% of the minimum wage. It hasn't always been that way. Until the early 1990s, employers in Massachusetts were required to pay tipped workers 60% of the minimum wage. In eight other states employers are required to pay the full minimum wage. In those states poverty among tipped workers is lower and job growth is just as good.   MassBudget's new fact sheet "The Steep Decline in the Employer Share of Tipped Workers' Wages" describes the history of the tipped minimum wage in Massachusetts and examines several proposals to reform it. Read THE PAPER The Massachusetts Budget and Policy Center (MassBudget) produces policy research, analysis, and data-driven recommendations focused on improving the lives of low- and middle-income children and adults, strengthening our state's economy, and enhancing the quality of life in Massachusetts. MASSACHUSETTS BUDGET AND POLICY CENTER 15 COURT SQUARE, SUITE 700 BOSTON, MA 02108

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New from MassBudget: Value of Minimum Wage is Eroded Quickly by Inflation

MassBudget    Information.    Participation.  Massachusetts Budget and Policy Center    Democracy. Value of Minimum Wage is Eroded Quickly by Inflation Restoring the value of the minimum wage can be an effective way to reward work and help low wage workers support themselves and their families. Adjusted for inflation, the minimum wage was $10.86 an hour in 1968. Today it is just over $8.00 an hour. That means that while a full time minimum wage worker made over $21,000 a year in 1968, such a worker makes only $16,000 today. Several proposals have been made recently to restore the value of the minimum wage. This Facts At A Glance, Value of the Minimum Wage is Eroded Quickly by Inflation, examines those proposals, shown in the graph below. Each proposal would increase the minimum in two or three steps to $10.50 or $11. To understand how close each proposal comes to restoring the value of the minimum wage, it is important to account for the effects of inflation. If costs are rising by 2 percent a year, then $10 next year will buy about the same amount of goods and services as can be bought for $9.80 this year. In other words, $10 next year will be worth about $9.80 in today's dollars -- because costs go up each year. Using CBO inflation projections, we find that an $11 wage in 2016 would be worth $10.43 in today's dollars, and a $10.50 wage in that year would be worth $10.07 in today's dollars. If the minimum wage is not adjusted for inflation each year after the final step of an increase, then the value will decline each year the cost of living rises. Read THIS PAPER The Massachusetts Budget and Policy Center (MassBudget) produces policy research, analysis, and data-driven recommendations focused on improving the lives of low- and middle-income children and adults, strengthening our state's economy, and enhancing the quality of life in Massachusetts. MASSACHUSETTS BUDGET AND POLICY CENTER 15 COURT SQUARE, SUITE 700 BOSTON, MA 02108

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In the News: youth rally, minimum wage

Local legislators and politicians joined nearly 1,000 young people from across the state Thursday to rally for increased funding for youth jobs programs. 

"You are out there giving a voice to a need in our society today, which is that the government needs to work together with the private sector to make sure there are opportunities for every single person here," state Rep. Tom Conroy, D-Wayland, told the crowd inside Boston's Old South Church. 

Conroy spoke alongside Attorney General Martha Coakley and Felix Arroyo, Boston's chief of Health and Human Services.

Read the full article here:
http://www.milforddailynews.com/article/20140221/NEWS/140229298

State Senate President Therese Murray wants the state’s minimum wage raised to $11 per hour. House Speaker Robert DeLeo, supports an increase, but wants it tied to changes in unemployment insurance. 

With dueling bills in the two chambers, there are two questions: what will the final solution be and when it it likely to be arrived at? 

“Both issues are in play in both chambers, but the division is more about process than substance at this point, I think,” Sen. Bruce Tarr, R-Gloucester, said Tuesday.

Read the full article here
http://www.milforddailynews.com/article/20140220/NEWS/140229762