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Report: Raising Minimum Wage = Major Economic Benefits for MI

PHOTO: The current minimum wage is no longer able to keep Michigan families out of poverty, but a new report finds that raising the wage will have broad benefits for the state's economy. Photo courtesy of freestockimages.com.
PHOTO: The current minimum wage is no longer able to keep Michigan families out of poverty, but a new report finds that raising the wage will have broad benefits for the state's economy. Photo courtesy of freestockimages.com.
October 22, 2013

LANSING, Mich. - With unemployment hovering around 9 percent, how to create jobs and stimulate Michigan's economy is the big question, and one organization says part of the answer could lie in raising the state's minimum wage. A new report from the Michigan League for Public Policy finds that increasing the state's minimum wage from its current $7.40 to $10.10 per hour would create 4600 full-time jobs and result in more than one billion dollars in increased economic activity over three years.

According to policy analyst Yannet Lathrop, author of the report, the benefits would ripple through the state at many levels.

"We're really talking not only about something that is good for the economy, good for workers' paychecks, good for the children of these workers, but we're also looking at what could be good for small businesses," she said.

Legislation has been introduced in both the Michigan House and Senate that would raise the state's minimum wage to $10 per hour by 2016.

Lathrop said that every Michigan worker, regardless of age, deserves a fair living wage, and she added that, contrary to popular belief, the vast majority of minimum-wage earners are not teenagers working after-school jobs.

"These are people who are adults, who are taking care of themselves, and a good number of them also are parents who are raising almost half a million children in Michigan," she said.

The report found that the real value of the minimum wage has dropped by 20 percent over the past four decades, and that if nothing is done, it will drop another 15 percent by 2022.

The legislation is SB 203 and HB 4554. The MLPP report is at bit.ly/1db5rEE.


Mona Shand, Public News Service - MI