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Report: Pay Gaps Could Narrow with Higher Minimum Wage

More than half of the American workers are paid less than $15-an-hour. (Tom Drigger/Flickr)
More than half of the American workers are paid less than $15-an-hour. (Tom Drigger/Flickr)
April 23, 2018

LANSING, Mich. – A new report calls for raising the federal minimum wage to $15 an hour to reduce poverty and promote pay equity. While the minimum wage in Michigan is $8.25 cents an hour, it still is $7.25 cents an hour in 21 other states.

Since the current federal minimum wage went into effect nine years ago, it has lost 13 percent of its value - and the minimum federal wage for workers who get tips has stayed at $2.13 an hour since 1991.

Emily Chatterjee, senior counsel at the Leadership Conference Education Fund, says raising the wage would do more than help lift people out of poverty.

"It would address the gender pay gap because women are over-represented in this workforce," she says. "It would also help address the racial wealth gap because people of color are also over-represented here."

The report - entitled "Bare Minimum: Why We Need to Raise Wages for America's Lowest-Paid Families" - includes first-hand accounts of low-wage workers struggling to make ends meet.

Chatterjee points out that people working for tips are twice as likely to live in poverty, and two-thirds of them are women. She adds that poverty isn't the only result.

"Tipped workers' livelihood shouldn't depend on whether a customer feels like being generous that day," she stresses. "There's a power imbalance there. In fact, a lot of tipped workers face increased levels of sexual harassment as a result of that."

Chatterjee says the report makes a case for raising the federal minimum wage to $15 as one of four steps to effectively fight poverty and wage inequality.

"We want to index it to inflation so that the value of the minimum wage doesn't erode over time," she adds. "We also want to eliminate the tip minimum wage, and we want to eliminate the sub-minimum wage that some people with disabilities are paid."

Fifty-eight-million workers are paid less than $15-an-hour. That's more than half the American workforce.

Mary Kuhlman, Public News Service - MI