who benefits: demographic impact of a $9.50 minimum wage

7/27/2019 Who Benefits: Demographic Impact of a $9.50 Minimum Wage

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Minnesota 2020

2324 University Avenue West,Suite 204, Saint Paul, MN 55114

www.mn2020.org

Editing: Joe SheeranDesign & Layout: Rachel Weeks

All work published by Minnesota 2020 is licensed under a Creative CommonsAttribution-No Derivative Works 3.0 Unported License.

Minnesota 2020 assisted in the editing, design and releaseof this report on behalf of the Raise the Wage Coalition, abroad group of faith, labor, non-pro t and service-based

organizations calling for policy that raises the statesminimum wage to $9.50 per hour by 2015.


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1Minnesota 2020 - www.mn2020.org

INTRODUCTION

Raising Minnesotas minimum wageto $9.50 an hour is good public policy.It would boost the states consumereconomy by providing workers anadditional $470 million in increasedspending power. This analysisexamines the various groups of Minnesotans who would be impacted by a $9.50 minimum wage.

Examining Minnesota employmentdata for workers whose wages are below $9.50 (and those slightly

above who would likely see a raisedue to the spillover effect), Raisethe Wage Coalition member JOBSNOW estimates that a $9.50 an hourminimum wage would mean a raisefor 357,000 Minnesotans.

Minnesotas working womenwould see a signi cant boost, asthey comprise 57 percent of those

likely impacted by a potential $9.50minimum wage. More than 200,000women would gain a $256 millionannual purchasing power boost.

A $9.50 minimum wage would also begin helping Minnesota addressthe growing poverty gap betweenwhite Minnesotans and people of color. More than 83,000 workers of color would see a raise, including 22percent of black workers (23,548), 29percent of Hispanic workers (30,337),and 17 percent of Asian workers(29,714).

A $9.50 minimum wage increasewould boost wealth by $31 millionfor Minnesotas black communityand by $43 million for the Hispaniccommunity, according to JOBS NOW

ndings.

The research also nds 77 percent of workers potentially impacted by a$9.50 minimum wage are 20 years oldand above, dispelling the myth thatteenagers comprise the majority of those earning minimum wage.

Roughly 33 percent of workers whowould see a wage increase (morethan 100,000 people) are married orare parents. About 137,000 childrenwould bene t from increased parentalincome.

Raising the wage is also importantfor Minnesotas broader workforce

because its economic reboundhas been heavily fueled by low-wage service sector jobs. Forty- vepercent of all Minnesotas recent jobopenings are part-time, according tothe Department of Employment andEconomic Developments (DEED)latest jobs vacancy survey.


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2 Who Bene ts: Demographic Impact of a $9.50 Minimum Wage

Theres no evidence of an overallshift to high-skill occupations, JOBSNOW nds, based on DEEDs data.Only 42 percent of job openingsrequire education or training beyondhigh schoolan even smaller sharethan four years ago when it was 44percent. Similarly, only 25 percent of openings require a four-year degree,compared with four years ago when itwas 29 percent.

Roughly 45 percent of workers whowould bene t from the wage increasehave at least some college education.Nearly 19 percent of all workers bene ting from a $9.50 minimumwage have at least an AssociatesDegree.

Raising the wage to $9.50 would putMinnesotans at the bottom of the payscale back on par with 1960s in ation-adjusted wage levels. Had thefederal minimum wage maintained

its purchasing power since 1968, it

would today be over $10.70 an hour,or $22,256 a year for a full-timeworker, according to the US Bureauof Labor Statistics. Furthermore,had minimum wage kept pace withaverage productivity gains, as it didin the decades leading up to the1960s, it would today be about $22.00an hour.

Instead it has stagnated and isnowhere near enough to even meet basic living standards in Minnesota. JOBS NOW Cost of Living researchshows that in a Minnesota familyof four with two full-time workingparents and two children, each parentneeds to earn at least $14 an hour tomeet even basic needs.

Raise the Wage Coalition urges theMinnesota Legislature to act onpolicy that raises the states minimumwage to $9.50 an hour early in the2014 legislative session.


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THE DATA

FIGURE 1: AFFECTED WORKERS BY GENDER

Data from JOBS NOW

FIGURE 2: WEALTH BUILDING EFFECT BY GENDER & RACE

Data from JOBS NOW


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4 Who Bene ts: Demographic Impact of a $9.50 Minimum Wage

FIGURE 3: MINORITY WEALTH BUILDING EFFECT BY RACE

Data from JOBS NOW

FIGURE 4: AFFECTED ADULT AND TEEN WORKERS

Data from JOBS NOW


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FIGURE 5: AFFECTED WORKERS BY MARITAL STATUS

Data from JOBS NOW

FIGURE 6: AFFECTED WORKERS BY EDUCATIONAL ATTAINMENT

Data from JOBS NOW


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who benefits: demographic impact of a $9.50 minimum wage

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