National Consumers League

Worker Rights

Worker Rights

Minimum wage movement building momentum

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People holding strike for a living wage signs"Tonight, let’s declare that in the wealthiest nation on Earth, no one who works full time should have to live in poverty, and raise the federal minimum wage to $9 an hour. This single step would raise the incomes of millions of working families. It could mean the difference between groceries or the food bank; rent or eviction; scraping by or finally getting ahead. For businesses across the country, it would mean customers with more money in their pockets."

- President Barack Obama, 2013 State of the Union Address

Our economic recovery is well underway, the stock market has reached record highs, and corporations are registering record profits. Yet American low-wage workers are struggling. The federal minimum wage of $7.25/hr has not increased in four years, and the tipped minimum wage has remained stagnant for 22 years at the meager $2.13/hr. A movement to increase the minimum wage, however, is gaining momentum. How will this turn out for workers across the country?

At a time when unemployment remains high, the biggest employers of low-wage workers are able to play a game of supply and demand with workers and salaries as pawns. High unemployment rates means no need for competitive wages; if one person quits, another worker (or 50) will be anxiously waiting to fill the position. Unless new legislation mandating an increase in the minimum wage is passed, big companies can continue to pay low wages, and low-wage workers will continue to suffer.

This week, fast food workers are holding a series of one-day strikes in cities across the country. From New York, to Chicago, to Kansas City, St. Louis, Detroit, Milwaukee, and Flint, workers will take to the streets, risking their jobs, to demand increased wages. These strikes follow a series of stoppages by hundreds of federally contracted workers in Washington, DC last month.

Big companies claim that they cannot afford to pay workers more money. A close examination of their financials, however, tells a much different story. According to the National Employment Law Project (NELP), 78 percent of the 50 largest low-wage employers have been profitable every year for the last three years. During this time, the average top executive has received a $9.4 million salary each year.

Median pay for chief executives at the nation’s top corporations jumped 16 percent last year. Between 2006 and 2012, the bottom 20 percent of workers, however, have seen their income fall 5 percent—proof that the rich keep getting richer and the poor keep getting poorer, with a growing income gap.

In addition to stagnant wages, many companies have devised other methods for ensuring that what they pay their employees remains low. Caterpillar Inc., for example, pressured its long-term employees to accept six-year pay freezes despite record profits of $4.9 billion last year. Walmart has started hiring only temporary workers to fill open positions. Employees who work part time make, on average, $7/hr less than their full-time counterparts.

Despite some growth, the economy could use a boost. Increasing the minimum wage would result in a raise for millions of Americans and, with more money in their pockets, millions of consumers would spend more.

In his State of the Union Address, President Obama proposed a $9.00 minimum wage; the Fair Minimum Wage Act of 2013 (S. 460) (H.R. 1010) proposes a $10.10 minimum wage; the Washington, DC City Council recently approved a $12.50 minimum wage at big-box stores.

What do you think? Is it time to raise the minimum wage? Join the discussion at our Facebook page.