Minimum Wage Testimony by Wendy Patton

Gongwer News Service - May 24, 2005

Gongwer News Service

SB 11 MINIMUM WAGE (Prentiss) To raise the standard minimum wage to $6.15 an hour beginning January 1, 2006, then to $7.15 an hour beginning January 1, 2007, and to require an annual adjustment of the standard minimum wage each year based on the consumer price index for urban wage earners and clerical workers.

Tim Burga, legislative director for the Ohio AFL-CIO, said that Ohio and Kansas are the only states that do not provide a state minimum wage at least equal to the federal level. He said the current federal minimum wage of $5.15 per hour has not been increased in nearly nine years, and that the Ohio minimum wage, “which in practice is $3.35,” was established in 1990. SB 11 would boost the state minimum to $6.15 per hour on January 1, 2006 and to $7.15 per hour on January 1, 2007. It would increase the minimum wage payable to certain tipped employees to $3.07 and $3.57 on the same timetable. “Thirteen states and Washington D.C. now have minimum wages above the federal level, two states have approved wages above the federal that have not yet taken effect, and two states, Maryland and Nevada, passed increases which may be implemented,” Mr. Burga said. “It’s time for Ohio to reclaim its spot as a state that values its workers.”

Samuel Gresham, president of the Columbus Urban League, said there has been an increase in the number of working families unable to meet their basic needs. He said a person working fulltime at today’s minimum wage earns about $10,700 a year. “How can anyone raise a family on that amount of money? Hard-working Ohioans should be able to live outside of poverty if they are willing to put in 40 hours a week,” Mr. Gresham said. He pointed out that Columbus is experiencing a significant influx of immigrants from Mexico and elsewhere who are competing for low-skilled jobs. “There appears to be a race to the bottom for wages,” Mr. Gresham said. “How can you allow an American citizen to work 40 hours a week with no health benefits and remain in a state of poverty?”

The Ohio Association of Second Harvest Foodbanks said hundreds of thousands of people are working at jobs that pay poverty wages and provide no health or retirement benefits. “While Ohio is trying to build a new frontier of high-paying, high-tech jobs, what is growing are our low-wage, no-benefit jobs,” said Lisa Hamler-Fugitt, executive director. She said minimum-wage workers and their families arrive in growing numbers at one of the organization’s 3,000 food pantries, soup kitchens, shelters, day care, and community centers. “Raising the minimum wage will help families meet their basic needs and build our state’s human capital and long-term economic security,” she said.

Wendy Patton of Policy Matters Ohio said that while the state’s current minimum wage of $4.25 an hour is lower than the federal level, the federal wage applies to most workers in the state. “The proposed Ohio legislation would directly affect 446,000 earning less than $7.15 an hour,” Ms. Patton said. Research that the non-profit, non-partisan institute conducted showed 60% of those who would get a raise are women; more than 70% are age 20 or older; and 75% work at least 20 hours weekly. She cited a series of studies to demonstrate that enactment of the bill would not result in a loss of jobs, would not force jobs out of the state, and would not result in substantial price increases. “Business owners that responded to a National Federation of Independent Business survey ranked the minimum wage issue 57th in importance,” Ms. Patton said. “Remember that anyone forced to raise wages will be competing with employers who have also been forced to raise wages.” Chairman Hottinger suggested, based on talks with small business owners, that one reason for the low ranking of the issue is that many already pay above the minimum wage.

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