As Congress Does Little To Address Wage Erosion, States Are Moving With Their Own Minimum Wage Legislation

As Washington seems incapable of figuring out how to ensure working Americans are paid a minimum wage that can keep up with the economy’s perpetually rising costs of living, especially for health care, many states have taken initiatives to try to offset the failures of federal lawmakers.

U.S. President Barack Obama said during his State of the Union address on Tuesday, as he did last year, that he intends to make raising the federal minimum wage a priority. But Obama went a step further this time, saying he would, by executive order, require federal contractors to pay their employees at least $10.10 an hour.

In 2009, the federal minimum wage was increased from $6.55 an hour to $7.25, a result of changes to the Fair Labor Standards Act of 1938 implemented in 2007 that ordered three incremental increases from $5.85 an hour. It was the first move in more than a decade by Capitol Hill and the White House to address wage erosion that most harms the country’s working poor.

The U.S. federal minimum wage has been incrementally increased a dozen times since 1974. But those raises occurred incrementally through only five Congressional actions, in 1974, 1977, 1989, 1996 and 2007, something that strongly indicates the federal government doesn’t pay much attention to the very real problem of hourly wage erosion until it hits a tipping point -- after the working poor have endured years of eroding wage value -- before Congress reacts. This year could see one of those historical moments, with or without Capitol Hill’s involvement.

We’ve been noticing a lot of momentum as states address of wage erosion. The issue is drawn along typical lines -- liberal Democrats taking the side of the labor supply, and Republicans siding with the job creators. They both claim to be working on behalf of the working poor, and debate incessantly by cherry picking their favorite think-tank analyses. Meanwhile, the working poor watch their wages get eaten up by the rising costs of housing, food, education and especially health care. Employers lament, as they do every time wage increase have been mandated in the past 75 years, that raising their payroll costs will cause them to lay off people. So far, however, no historical minimum wage increase in the U.S. has led to a socialist revolution, long lines at soup kitchens, or the collapse of capitalism as we know it.

On Jan. 1, 13 states saw their minimum wages automatically increase. Workers on the entire west coast (in California, Oregon and Washington) now make a minimu wage of between $9 and $9.32 an hour. In the Southeast, Florida saw its wage floor rise to $7.93 an hour. Four states in the Northeast now pay between $8 and $8.70 an hour minimum. Meanwhile, nine states either don’t have a minimum wage or have a minimum wage that’s lower than the federal standard even though employers in those state are required to adhere to the federal law.

And now dozens of states appear to be confronting moves, either by governors, lawmakers or ballot-initiative petitions, to push up wage floors. Here’s a rundown by state of the country’s major minimum wage pushes. Some will fail, others are almost sure to pass. But one thing is certain: Many states are responding to the problems of wage erosion better than Capitol Hill, which, by the way, has received 14 pay raises since 1975 and have up to 75 percent of their health insurance premiums paid for thanks to working taxpayers. You’re welcome.

Alabama – Rep. Darrio Melton, a Democrat representing the state’s 67th District, will propose a constitutional amendment in the upcoming state legislative session to increase the minimum wage in three stages until it hits $9.80 in 2016. Melton told AL.com earlier this month that conservatives can’t “have it both ways” by moving to cut social welfare programs while working to keep wages of the working poor down.

Alaska – Locals submitted a petition on Jan. 17 of more than 43,000 signatures for a ballot initiative that would ask voters if they want to increase the state’s $7.75 minimum wage to $8.75 by the start of 2015 and $9.75 by Jan. 1, 2016. Afterward, the hourly minimum would be pegged to inflation or $1 over the federal minimum, whichever is greater. At least 30,169 of these signatures from at least 30 of 40 state legislative districts must be validated for the ballot initiative to make it to the voters in August, according to the Anchorage Daily News.

Arkansas – Supporters have until July 7 to gather 62,507 signatures to get the Give Arkansas a Raise Now ballet proposal (full text of an earlier draft here) that would appear on a Nov. 4 general election ballot, according to Arkansas News. The proposal would increase the minimum hourly wage to $7.50 on Jan. 1, 2015, $8 an hour a year later and $8.50 by 2017. U.S. Sen. Mark Pryor (D-Ark.) told local ABC affiliate KATV on Dec. 30 that he opposes the White House’s proposal to raise the minimum wage to $10.10 an hour but supports the local initiative as a “pretty reasonable approach.” The state’s current minimum wage is $6.25 an hour, but employers are required to pay the federal minimum of $7.25.

Delaware – On Tuesday, a bill passed from Delaware’s Senate economic development committee that would raise the minimum wage to $7.25 on July 1 and $8.25 on Jan. 1, 2015. The bill was amended to lower the original proposed increases from $8 and $8.75, respectively.

Florida – Senate Bill 456 and House Bill 385 would raise the state’s minimum wage to the same $10.10 hourly rate that federal congressional Democrats and President Obama are calling for. The current hourly minimum in Florida is $7.93 an hour. Florida’s current wage law tags the minimum wage to cost-of-living increases. The wage increased by 14 cents on Jan. 1. "When I hear a politician say that we have to raise the minimum wage so working families can make ends meet, I cringe, because I know that statement is a lie," Florida’s Republican Gov. Rick Scott said in an email to the Tampa Bay Times earlier this month. State Sen. Dwight Bullard (D-Miami) is a key advocate for the wage hike. State Rep. Cynthia Stafford (D-Miami) is sponsoring the bill.

Georgia – Senate Bill 314 would raise the minimum wage in Georgia to $10.10 an hour and would index the wage to cost-of-living increases based on an annual assessment from the state’s Department of Labor. House Bill 681 would raise the hourly wage to a minimum of $8.10 an hour before Dec. 31, 2015, and $8.95 an hour before the end of 2017. On Jan. 1, 2018, the wage would rise to $9.80 an hour. The state’s current minimum wage is $5.15, but the employers in the state are required by federal law to pay the higher federal minimum.

Hawaii – SB 331 that’s awaiting conference committee after being carried over from the last legislative session would increase the state’s minimum hourly wage to in three annual increments until it hits $9 on Jan. 1, 2017. “Minimum wage earners in Hawaii currently earn $15,080 annually working 40 hours a week for 52 weeks. A person with one child earning $15,080 is $2,770 below the Hawaii poverty level in 2013,” Dwight Takamine, head of the state’s Department of Labor and Industrial Relations, was quoted as saying by Honolulu Civil Beat reporter Chad Blair.

Idaho – The group Raise Idaho is currently collecting signatures to get a ballot measure in November to increase the state’s minimum hourly wage to $8.10 per hour on Jan. 1, 2015; $8.95 an hour by the start of 2016; and $9.80 an hour by 2017. After that, the state’s Department of Labor would annually calculate an adjusted increase to the minimum wage based on an increase to the consumer price index. The group needs 53,751 signatures submitted by April 30. Roaring Springs Waterpark in Meridian, Idaho, told the ABC affiliate KBOI2 in a Jan. 1 report that a $9 minimum wage would cost the company an additional $200,000 a year in labor costs.

Illinois – Gov. Pat Quinn wants to increase the state’s minimum wage from $8.25 to $10 by 2017. Quinn is seeking re-election and has made the wage hike a plank on his platform. State Sen. Kimberly Lightford (D-Westchester) has been pushing for the hike but failed to get enough support for it in 2012. “I’m hoping that now that there’s much discussion about it, we’re at a point where some members who were perhaps ‘maybes,’ they weren’t quite sure, maybe we can get them to become ‘yes’ votes now,” Lightfoot was quoted as saying by Chicago Public Media’s WBEZ91.5 earlier this month.

Iowa – State House Democrats introduced a bill on Jan. 15 that would raise the minimum wage incrementally to $10.10 an hour over the next two years. An independent poll by Public Policy Polling commissioned by the left-leaning Progress Iowa suggests a majority of Iowans support increasing the minimum wage while 36 percent oppose it. Allen Zindrick, owner of Smuggler’s Wharf seafood restaurant, told ABC affiliate KCRG in Cedar Rapids that if he has to pay dishwashers $10.10 an hour then menu prices would increase and he would lose business.

Kentucky – State House Bill 1 that was introduced earlier this month was posted to committee on Jan. 23. The bill would raise the minimum wage to $8.10 an hour on July 1, $9.15 an hour a year later and $10.10 by the summer of 2016. Jeff Hoover (R-Jamestown) lambasted the move by state Democrats to push up the minimum, hourly wage as “redistribution of wealth,” according to a report earlier this month in the Lexington Herald-Leader.

Maryland – On Jan. 14, Gov. Martin O’Malley announced he would urge the state lawmakers to pass a bill to boost the minimum wage to $10.10 an hour by the end of 2016 and then peg the rate to rising cost of living. "When workers have more money, businesses have more customers,” said a post on the governor’s Twitter account.

Massachusetts – The state that introduced the nation’s first minimum wage law, in 1912, would become the state with the highest minimum wage if a bill that passed the Senate 32-7 in November is also passed by the state’s lower house this year. The bill would raise the hourly wage from $8 to $11 by 2016 with two incremental increases in between and then peg future increases to inflation. It also states that the minimum wage can never fall under 50 cents from the federal standard. House Bill 3846 was referred to committee earlier this month.

Michigan – Legislative bills were introduced in 2013 to boost the minimum wage from $7.40 an hour to $10 hourly over three years. Separately, a group called Raise Michigan is currently moving forward with a drive to push the wage up to between $9 and $10.10 an hour, the group’s treasurer Frank Houston told the Grand Haven Tribune in a report published Tuesday. The state’s Chamber of Commerce responded by saying a wage hike would lower job opportunities and force higher-skilled workers to take on more responsibility.

Minnesota – The Democrat-controlled state legislature will very likely pass a bill to raise the state’s current $6.15 an hour minimum wage to $9.50. "If we raise the minimum wage to $9.50 an hour, 360,000 Minnesota workers would see a pay increase," Democrat Rep. Ryan Winkler, told local NBC affiliate KARE on Wednesday. The next state legislative session beings in February.

Missouri – One of the few Midwestern states that has a minimum wage that’s higher than the current federal standard, at $7.50 an hour as of Jan. 1 thanks to a state law that adjusts the wage to inflation, has some legislative and grassroots momentum that seeks to raise the hourly wage floor to between $8 and $10.25. But the state legislature is controlled by pro-business Republicans. “It’s going to be a difficult sell in the Missouri Legislature, I’m certain of that,” Rep. Pat Conway, D-St. Joseph, co-sponsor of one of the measures, told the St. Louis Post-Dispatch in a report published Wednesday.

Nebraska – LB 943, introduced on Jan. 16 to the 103rd Nebraska State Legislature, would increase the state’s minimum hourly wage from $7.25 to $7.65 on Jan. 1, 2015; $8.35 a year later; and $9 by 2017. State Sen. Tom Carlson, a Republican who is running to be the next governor, said earlier this month he opposes the measure.

New Mexico – Sen. Richard Martinez, D-Española, introduced SJR 13, which would amend the state constitution to index the state’s current $7.50 an hour minimum wage to inflation. The increase would be retroactively applied to a rise in the cost of living since 2009, so it would have an immediate effect. If lawmakers pass the measure it would be on the state’s November ballot. The move was a response to Gov. Susana Martinez’s veto of a bill that would have raised the minimum wage by $1, according to the New Mexico Telegram.

New York – A.8343 was proposed earlier this month to expedite a scheduled increase in the hourly minimum wage. Legislation passed last year caused the wage to increase from $7.25 to $8 an hour as of Jan. 1. That law stipulates a second of three increases to take effect next Jan. 1, to $8.75. But the sponsors of A.8343 introduced on Jan. 9 increase the wage to $9 after Dec. 31 and tie future increases to an annual assessment of the rising cost of living.

Pennsylvania – Several bills have been proposed to increase the state’s current hourly minimum wage of $7.25, most notably HB 1941 and HB 1942. It would be the first time the state has tackled the wage floor since 1968. HB 1941 would lift a ban on cities, counties and boroughs from implementing their own alternative (higher) minimum wage rates, such as we’ve seen in cities including San Francisco, Santa Fe, San Jose and Albuquerque, which that have their own wage rates to account for the higher costs of living compared to rural communities in those states. HB 1942 seeks to gradually increase the minimum wage to $11.50 an hour, including raise to $9 an hour within 60 days of the bill’s enactment.

Rhode Island: After raising the wage to $8 an hour last year, the second consecutive annual increase, a new bill introduced this month by Democrat Rep. James McLaughlin would increase that wage to $9 an hour next year.

South Carolina – Two bills and one resolution is being considered in South Carolina, one of five states in the country (all of them in the South) that currently has no minimum wage, which means employers must abide by the federal wage laws. One bill would create the state’s first minimum wage to $10 an hour and increase in the future should federal minimum wage rise above that. Another bill would make the state’s minimum wage $1 above the federal minimum. A resolution could be put to the voters to amend the constitution to allow a local minimum wage to be greater than the federal standard.

South Dakota – Democrats and labor union supporters successfully gathered enough petitions to get a ballot measure this year to raise the minimum hourly wage from $7.25 to $8.50 after Dec. 31. It would also make South Dakota the 12th state to include an annual cost-of-living adjustment.

Utah – Sen. Jim Dabakis, D-Salt Lake City, is proposing that Utah raise its hourly rate from $7.25 to $10 an hour. “People are making $1,200 dollars a month gross income and we expect them to live on that,” Dabakis said as reported Wednesday in The Digital Universe. “Raising the minimum wage isn’t going to hurt our society, and it isn’t going to hurt our culture and it certainly is not going to hurt our economy.” If passed, the bill would make Utah the state with the highest wage floor, above Washington state’s current $9.32 an hour.

Vermont – Vermont’s minimum hourly wage increased by 13 cents to $8.73 an hour to adjust for the cost of living. Now the state legislature is considering boosting the wage to as much as $12.50 an hour by 2016. If the House bill passes as is, Vermont would become the state with the highest wage floor. Joann Erenhouse, executive director of the Bennington Area Chamber of Commerce, told the Bennington Banner earlier this month that most minimum wage earners are “fringe workers” who aren’t supporting families on that wage but rather the supplementing a household income where the main breadwinner has an above-minimum-wage job.

Virginia – State Del. Joe Morrissey, a Democrat, introduced this month HB32 that would increase the minimum hourly wage from $7.25 to $8.50 per hour by July. But the state legislature is dominated by Republicans and “it’s extremely unlikely for the minimum-wage bill to reach the floor,” Jesse Richman, director of Old Dominion University’s Political Science Research Center, told the Virginian Pilot earlier this month.

Washington – The state with the current highest minimum hourly wage rate now has a bill that would help keep Washington on top of the list. State House Bill 2672 would raise the floor to $12 an hour by 2017.

Wisconsin – The state’s current $7.25 an hour minimum would go up to $7.60 if legislation is passed this year. Gov. Scott Walker is naturally opposed to the measure proposed by state Democrats. “People can’t survive on the minimum wage in Wisconsin under Walker’s leadership,” Mike Tate, Chairman of the Wisconsin Democratic Party, told the local Fox affiliate earlier this month. “He’s out hobnobbing with CEO’s. He’s not worrying about what the average Wisconsin family is going through

Wyoming – Two Cheyenne-area lawmakers are submitting legislation to raise the state’s minimum wage from $5.15 an hour to $9 an hour.