Minimum wage: Good, bad, or ugly

The minimum wage issue has been discussed and debated since its 1938 inception. The reasons for and against raising the minimum have not changed very much either. That was the case at the recent Minnesota House Select Committee on Living Wage Jobs session held in Moorhead on October 2. Community members once again shared their views on the never-ending quest to solve the poverty issue simply by another increase in the minimum wage. It is definitely a simple “feel good” exercise without tackling the root causes and truly making a difference.

The discussion always begins with the hypothetical married couple with two children: How can such a family survive on $580 a week or $30,160 annually if both parents work? How can anyone be so heartless to deny this family a living wage? Please, may we move beyond this worn out red herring? This couple is not the normal situation in the minimum wage discussion and focusing on it detracts from a real solution. In my business experience, I observed that increasing the minimum wage is counterproductive, as fewer workers were employed over time.

According to the U.S. Bureau of Labor Statistics website, the above situation is less than 2% of the total. The bigger question is why have those two individuals not been able to advance beyond the starting gate? Something else is going on besides an hourly wage issue.

Furthermore, the Bureau states that minimum wage workers tend to be young. Although workers under age 25 represent only about one-fifth of hourly-paid workers, they make up about half of those paid the Federal minimum wage. Among employed teenagers paid by the hour, about 23 percent earn the minimum wage, compared with about 3 percent of workers age 25 and over. Let’s repeat that last part: Only 3 percent of all U.S. workers over the age of 25 are paid the minimum wage.

Now that we understand the demographics of the issue, how do we go about helping those needing our compassion and action? This is paramount because we are a society that cares for one another. We must come together, delve deeper into the issue, and find a resolution. With the past experiences of raising the minimum wage not solving the poverty issue, let’s develop a plan that will actually help those in need. As a starter, it is important to know that education and training may be an answer. For example, those with an associate degree are less than one percent of minimum hourly wage earners.

Ask any successful businessperson, they seek and need skilled workers. Give me a call: together, we can make a difference through training and education.

Chuck Chadwick, Executive Director

Moorhead Business Association

chuck@moorheadbusinessassociation.org
218 284-4643

moorheadbusinessassociation.org