CHARLESTON, W.Va. – Raising the minimum wage would help the state's working poor and in the process, improve the economy for everyone, according to a new analysis.

Sean O'Leary, policy analyst with the West Virginia Center on Budget and Policy, is the author of the new report, Giving West Virginia's Workers a Raise.

It highlights a big gap between rich and poor that is dragging both groups down.

O'Leary says boosting wages at the bottom would help more than 100,000 of the people who need it most.

"We're not talking about part-time workers, kids working summer jobs for spending money,” he says. “We're talking about adult workers, working full-time, who are supporting their families."

O'Leary adds raising the minimum wage is not a silver bullet, but it would help slow the erosion of the middle class and strengthen an economy that he sees as badly out of balance.

Several states have raised their minimum wages, although West Virginia isn't one of them, and there's a proposal in Congress to raise the national minimum wage to $10.10 an hour.

Critics say that would increase unemployment and inflation. But O'Leary says economists have studied the topic extensively and have found that isn't the case.

He points out that the businesses paying the higher wage make the money back almost immediately.

"When Wal-Mart pays their employees more, they turn right back around and spend that money at Wal-Mart," he explains.

O'Leary’s analysis also finds raising wages at the low end is actually only a small expense for businesses that is often covered by reduced turnover and training costs.

"There's less turnover, there's less vacancies, there's fewer training and hiring costs,” he explains. “That really saves them a significant amount of money, in some cases, completely offsetting the cost of increasing the minimum wage."

The report says raising the wage even to $8.50 an hour would benefit 120,000 workers in West Virginia – many, O'Leary adds, in families being left behind by the decline in well-paid industrial jobs.

"By raising the minimum wage, you're giving those working families an opportunity to work their way out of poverty,” he says, “where right now, there's very little they can do."




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Women of color working in health care are the most likely to lose out on wages they have earned because employers fail to pay what they owe, according to the U.S. Department of Labor.

Investigations have found 80% of violations affect home-care aides, nursing aides and licensed practical nurses, especially women working in Black, Hispanic and Asian communities.

Joseph Callihan, wage and hour investigator for the U.S. Department of Labor, said the most common violations are a failure to pay overtime or federal minimum wages, or misclassifying employees as independent contractors.

"These cases can be either complaint-driven cases or they can be target-driven," Callihan explained. "Where we know this industry is problematic, and we will go ahead and do a directed investigation."

Earlier this month, the Labor Department recovered $1.2 million in back wages for 599 home health care workers at three employers in Texas and one in Louisiana. In Texas, the department found the employers' pay practices violated the Fair Labor Standards Act and calculated 400 employees were owed $841,000 in overtime back wages.

The three Texas employers found to have violated laws were located in Laredo, Pharr and San Juan. Callihan noted an employer's failure to pay is not always intentional, and can be because they do not know the rules, even though the Labor Department provides "fact sheets."

"There's generally overtime violations in the industry, where they could be paying straight time for overtime, or they could be backing into the overtime rates," Callihan added.

Since 2021, the federal agency has completed more than 1,600 investigations, and recovered almost $29 million in back wages and damages for nearly 25,000 workers, with employer fines totaling more than $1 million.

A new proposal from the U-S Department of Labor would clearly define what it means to be an independent contractor. Currently, the Department of Labor's definition refers to independent contractors as, "workers who, as a matter of economic reality, are not economically dependent on their employer for work and are in business for themselves."

A new definition would more clearly distinguish between them and regular employees, who are covered by more federal labor protections.

Jack Fiorito, a distinguished professor at Florida State University, explained what the new definition would do.

"The Department of Labor is saying, in effect, there are too many instances where people are, for all practical purposes, employees," Fiorito said, "but are being excluded from these laws because they're technically considered, according to the contracting party, they're considered independent contractors."

Fiorito said some opposition has come from employers who do not see themselves as such. Others are worried the gig economy would decay since independent contractors would be classified as employees, meaning they would not be making as much money. November 28 is the deadline to submit comments to the Department of Labor about the proposal.

Rapid growth in the recent decade of gig-economy companies that utilize independent contractors has made this rule necessary. But, there could be some big challenges ahead. Fiorito said one of the big ones is that the recent elections will impact whether this proposal comes to fruition.

"If they could do something before the next Congress takes office, that's about another month or so, that would probably be their only chance to do it, really. Because I think the new Congress with a Republican majority in the House is probably going to be looking to roll back any such regulations that the Department of Labor might be considering rather than expanding those," Fiorito said.

He remains uncertain as to whether the new Congress will stall on this issue or come together on it. The new rule would have sweeping implications if enacted. According to the Department of Labor estimates, there are about 22.1-million independent contractors across the nation.

On Nebraska's ballot initiative to increase the state's minimum wage by $1.50 per year between 2023 and 2026, 60% of Nebraska midterm voters said "yes," which means the Nebraska minimum wage will reach $15 an hour by 2026.

Ken Smith, economic justice program director for Nebraska Appleseed, one of 27 groups behind the Raise the Wage Nebraska coalition, acknowledged not everyone is pleased with the win. Smith said although some people feel a period of high inflation is a bad time to raise wages, coalition members believe the opposite is true.

"Our perspective is that if the cost of food and shelter and health care and child care is going up, it is a reason to ensure that Nebraskans are paid a living wage," Smith contended.

Smith pointed out history does not support the concern raising the minimum wage will hurt businesses. He cited Nebraska's experience after the 2014 minimum-wage increase and the experiences of neighboring states, and thinks the positive impact higher wages can have on businesses is one of the reasons some people voted for the initiative.

"And, in fact, it's largely been to the economic benefit of states and cities that have raised the minimum wage," Smith asserted "It's good for businesses, just as it's good for workers, and that's one of the reasons why so many people came out to support this issue in November."

Nearly 300 business owners and executives went on record in favor of the increase.

Another argument the coalition heard was small-town Nebraskans should not need the same minimum wage as workers in the metropolitan areas. Smith pointed to an MIT cost-of-living calculator, which supports the statewide increase.

"And it shows that across the state by 2026, when our wages are now scheduled to hit $15 per hour, that would be a base minimum wage that's needed in every single county across the state," Smith outlined.

The minimum wage applies to tipped workers as well. At the end of a pay period, a tipped employee's guaranteed minimum of $2.13 an hour plus their tips, must add up to at least the minimum hourly wage, or the employer must make up the difference. Smith explained the coalition is aware it does not always happen, and could be addressed separately in the future.