Raising the Minimum Wage Can Help Wisconsin Families, Businesses, and Economy
A new proposal to raise the federal minimum wage would raise the wages of more than one in five Wisconsin workers and give a boost to businesses and the state economy. More than half a million workers in Wisconsin would be affected by a bill sponsored by Senators Tom Harkin and George Miller, which would raise the minimum wage to $9.80 over three years and tie future increases to the cost of living.
The minimum wage has not kept up with increases in costs of living, meaning that the lowest-paid workers have seen their paychecks steadily decrease. The current federal minimum wage of $7.25 has not been raised since 2009, and has lost six percent of its value due to inflation since then. The minimum wage would be more than $10 today if Congress had adjusted it to keep pace with increases in the cost of living since the 1960s.
In Wisconsin, working families, businesses, and the economy would all get a boost from an increase in the minimum wage. Nearly 140,000 working parents in Wisconsin would experience wage increases if the minimum wage increased, according to a new report released from the Economic Policy Institute. That includes 85,000 parents who would be directly affected by the wage increase, and another 55,000 who would experience an indirect increase in wages due to the ripple effect of increasing the minimum wage. The typical wage increase for working parents in Wisconsin would be around $600 per year. More than one out of four Wisconsin children would have their economic well-being improved by the increase in the minimum wage.
Wisconsin businesses and state economy would benefit from an increase in the minimum wage as well. Increasing the minimum wage boosts consumer spending, and creates new customers for businesses. Unlike higher earners who typically save more, working-class families spend the additional money on necessities in their community. Raising the minimum wage is one of the few strategies to boost consumer spending that doesn’t worsen state or federal deficits.