Business View Magazine | March 2019

3 From the Editor I n 1938, Congress passed the Fair Labor Standards Act, establishing the original federal minimum wage – 25 cents per hour. Since that time, it has been raised 22 times. Today, the federal minimum wage is $7.25, and the last time it was raised was in 2009. The minimum wage had its lowest buying power in 1948, when it was worth about $3.81 in today’s dollars, and its highest buying power in 1968, when it was worth about $11.83 in today’s dollars. This year, more than 17 million U.S. workers will see increased pay due to minimum wage hikes in 20 states and 21 cities. The states raising the minimum wage in 2019 are: Alaska, Arizona, Arkansas, California, Colorado, Delaware, Florida, Maine, Mas- sachusetts, Michigan, Minnesota, Missouri, Montana, New Jersey, New York, Ohio, Rhode Island, South Dakota, Washington, and Vermont. The “Fight for 15” campaign began in 2012, when the minimum wage in New York State was $7.25. Fast-food wages had barely budged for many years, leaving many workers unable to feed their families and pay their bills. So, late that year, workers at several fast-food restaurants in New York City walked off the job and staged the first rallies for a $15 minimum wage. Proponents of raising the minimum wage argued that $7.25 per hour is simply an insufficient sum in today’s economy. Accord- ing to projections based on the Economic Policy Institute’s Family Budget Calcula- tor, by 2024, in areas all across the United States, a single adult without children will need at least $31,200—what a full-time worker making $15 an hour earns annu- ally—to achieve a modest, but adequate standard of living. Workers in costlier areas and those with children will need even more. In 2018, the National Low Income Housing Coalition reported that the national two-bedroom Housing Wage was $22.10 per hour, mean- ing that a household must have an an- nual income of at least $45,960 to afford a two-bedroom rental home at HUD’s average fair-market rent of $1,149 per month. In other words, a full-time minimum wage earner would have to work approximately 122 hours per week for 52 weeks a year to afford a two-bedroom apartment. In addition, proponents contend that raising the minimum wage puts more money in the pockets of workers who promptly spend those extra dollars into the economy. A $15 minimum wage by 2024 would generate $120 billion in higher wages for workers, spurring greater business activity and job growth. Henry Ford apparently appreci- ated this dynamic 100 years ago, when he decided to pay his workers an unheard of wage of $5 per day. He knew that if his own employees couldn’t afford to buy the cars they, themselves, made, he would never make a profit. His understanding of this basic principle of economics allowed him to become one of the world’s richest men, while concurrently helping to build the great American middle class. Over the years, opponents of raising the minimum wage have argued that it would be a “job killer,” because businesses will be less likely to hire low-skilled workers if it cost them more to do so. And yet, research- ers have found that raising the minimum wage, whether on the national, state, county, or municipal level has no negative effect on employment. In fact, some studies have found employment actually increases slightly when a minimum wage is raised, be- cause it has the effect of reducing turnover, and forcing firms away from a low human capital investment model to one where workers stay attached to the workforce and employers make stronger investments in training. Others argue that most minimum wage earners are high school kids working after school or at summer jobs and don’t need more money. But the numbers tend to belie that argument, as well. In fact, fewer than 10 percent are teenagers, and more than half are prime-age adults between the ages of 25 and 54. More than half (58 percent) are women, 60 percent work full time, nearly half (44 percent) have some college experience, and 28 percent have children. Last month, the House of Representatives introduced a bill to gradually raise the federal minimum wage to $15 per hour, and several of the declared, or prospective, Democrats running for President in 2020 have made it part of their platforms. The Trump administration and the Republican Senate, as well as many business organiza- tions oppose the plan, setting up a political contest that will likely continue for the next two years. Meanwhile, the “Fight for 15” continues. Al Krulick Editor-in-Chief Editor-in-Chief Al Krulick Associate Editor Lorie Lee Steiner Vice President of Operations Lauren Blackwell Research Directors Paul Payne Brendan McElroy Josh Conklin Lisa Curry Matthew Mitchell Matthew Blankenship Tyler Raffauf Digital Strategist Jon Bartlow Director of Administration Alyson Casey Creative Director Kulvir Singh Vice President of Business Development Erin O’Donoghue Vice President of Publishing Andre Barefield CGO Alexander Wynne-Jones COO Brian Andersen Executive Publisher / CEO Marcus VandenBrink USA Canada Caribbean Oceania Email for all inquiries: info@businessviewmagazine.com WWW.BUSINESSVIEWMAGAZINE.COM 12559 New Brittany Blvd Fort Myers, FL 33907 239.220.5554 CONTACT US