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Peeling back the layers of WI minimum wage policy

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Tuesday, January 2, 2024   

Bills are pending in Congress to boost the federal minimum wage, which remains at $7.25 an hour.

Separately, many states increased their wage levels Monday - but not Wisconsin, and a regional expert says that leaves some workers behind.

Like the federal government, Wisconsin has kept its minimum wage at $7.25 for more than a decade.

Labor Economist Laura Dresser has studied the issue for the Center on Wisconsin Strategy - where she's the associate director.

She said even though employers are increasingly offering higher wages in a tight labor market, competitive pay isn't reaching everyone.

"So, that $7.25 really matters, but it's less binding today than it was in the past," said Dresser. "But for the workers who really have those constraints on opportunity because of their concerns about immigration status, concerns about physical mobility - employers can really take advantage of that."

She said that makes it especially hard when there's more pressure from inflation. Her findings show that raising the minimum wage to $15 an hour by 2028 would boost pay for nearly 15% of Wisconsin workers.

Skeptics of such moves argue about hurting businesses, but Dresser said research on California's higher level found no measurable impact on jobs.

Dresser noted that supporting a higher minimum wage is not necessarily a political issue, with increases seen in both conservative and left-leaning states.

She pointed out that in those states, it's not just the workers who are benefiting.

"You can also see that in state economies where they've raised the minimum wage," said Dresser, "there's actually a payoff that employers are receiving - because while they raise the wage, they're also reducing costs associated with turnover and open positions that they can't fill."

She said the higher wage helps the employee with things like transportation and child care, making it easier for them to stay in their job.

Dresser's research also notes that Black and brown workers and women stand the most to gain when there's a minimum-wage boost.

As for the congressional plans, there are competing proposals from Democrats and Republicans with different scales for raising the wage.




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