We’re Thinking About the Minimum Wage All Wrong

The debate about raising the minimum wage is full of misconceptions…and that leads to a lot more partisan fighting than there needs to be. For example, a celebrated Republican pollster found that 80% of business executives actually support raising the minimum wage. Dr. Sarah Jane Glynn, an expert in employment, work, and family issues at the Center for American Progress, says that we if we started talking about the reality of the minimum wage, we could solve the problem and get to consensus as a country a lot faster.

Listen to the full conversation here:

Matt Robison: It seems like there’s a lot more noise out there than people realize on the minimum wage.  Let’s set it straight.  First of all, what is it?

Sarah Jane Glynn: The minimum wage is the minimum amount that an employer can pay a worker for an hour of their labor. The federal minimum in the United States is $7.25.  It’s $2.13 if you’re a tipped worker. Also, 29 States and the District of Columbia have higher minimum wages: the highest right now is $15 an hour.

Matt Robison: What does a minimum wage earner look like demographically? Who are they?

Sarah Jane Glynn: Most people think about a scene from the movie Fast Times at Ridgemont High: a bunch of teenage kids in dorky outfits flipping burgers.

But the truth is only about one in 10 are teenagers. 90% are adults. Almost half have at least some college education. And 20% are parents. So it’s mostly adults. Most of them work full time. And many are raising kids. Also, and this is critical, it’s mostly women. Almost 60% are women and disproportionately women of color.

So this idea that it’s a bunch of kids who are earning pocket money in the summer is just not the case. The average is probably a mom who has some college and is probably a woman of color who is working in a low wage job. In fact, among those mothers, 65% are breadwinners for their families.

Matt Robison: What does $7.25 mean in terms of what you can afford?

Sarah Jane Glynn: In 1968, the minimum wage was $1.60. That does not sound like very much, but it was actually the highest actual purchasing power. That $1.60 could buy you more than $7.25 today.  And even then it was barely covering necessities.

Matt Robison: Why has an increase been controversial?

Sarah Jane Glynn: If you talk to actual people it’s not. The majority support raising the minimum wage. Polling shows at least 60% of Americans support $15 an hour. The primary opposition is from lobbyists for certain industries.

Matt Robison:  You’ve pointed out in your work that if we can shift the way we think and talk about the minimum wage – if we get rid of the misconceptions – we might be able to achieve more widespread and even bipartisan support.  How do we do that?

Sarah Jane Glynn: By talking about the reality.  What we really should be thinking about are working moms. Because we know that that’s a huge chunk of who these workers are. And that’s a significant population that would be impacted.

Of course, everybody deserves to be paid fairly for their work. I was once a 16-year-old working at McDonald’s for minimum wage. But if we’re thinking about the reality of who most of these workers are – adults, parents, people who are supporting their families and supporting their households – we may all be able to agree that there’s no reason why we should make life this hard for workers in America.

And of course, this wouldn’t just affect people below $15 an hour. If you’re somebody who’s making a bit more than that line right now, It’s pretty likely that you’re going to get nudged up too. It’s not just for the 32 million people in this country who are currently making less than $15.

Matt Robison: What about the pushback argument about negative impacts on the economy?

Sarah Jane Glynn:  The overall economic impact is very positive. If you want people to spend more and boost the economy, you need to give money to the folks who will actually spend that money. Of these millions of moms who are currently making at or around the minimum wage, if they see an increase in their wages, they’re going to go out and buy new shoes for their kid, pay to keep the lights on, and buy groceries.

In terms of the argument about inflation, we’ve got data on this because we’ve increased the minimum wage many times since the 1930s. There is a small uptick in prices when employers have to absorb higher costs, but it is not a lot. When McDonald’s raised their minimum wage to $10 an hour, the cost of a Big Mac went up by 1.4%. Pennies.

In terms of jobs impacts, economists are all over the map on this and there’s a lot of opinion and biases I out there, but the highest quality studies don’t find a job loss.

We share edited excerpts from the Great Ideas podcast every week that explain how policies work and present innovative solutions for problems. Please subscribe, and to hear Dr. Glynn’s other insights on the minimum wage, check out the full episode on Apple, Spotify, Google, Anchor, Breaker, Pocket, RadioPublic, or Stitcher