Out of the Basement: Who Would Benefit from a Minimum Wage Increase in Ohio?
April 15, 2005
The federal minimum wage of $5.15 an hour has less purchasing power than in all but one of the past fifty years. Since 1968, the value of a minimum wage paycheck has fallen by more than thirty percent. A full-time minimum wage worker brings in only $10,712 a year.
Fifteen states and Washington D.C. have taken action to implement state minimum wages that exceed the federal. Ohio is one of only two states to set its minimum wage below the federal, although the national rate applies to most workers here. The current proposal to raise Ohio’s minimum wage to $7.15 is comparable to laws that have passed in other states.
The proposed Ohio legislation would directly affect 446,000 covered employees earning less than $7.15 an hour. Of those who would get a raise, the majority (60 percent) are women workers, more than 70 percent are age 20 or older, and more than three-fourths work at least twenty hours weekly. The lowest-earning forty percent of Ohio households, which take in just 16 percent of total earnings, would enjoy 57 percent of the gains from the increase. Families with employees that would be affected rely on those workers for half of the family’s earnings on average. Over one-third (37 percent) rely on those family members for the entire family income.
In short, the federal minimum wage is at an extremely low point. Many states are acting to raise their minimum wages. If Ohio followed suit, the main beneficiaries would be in low-income households that rely heavily on these earnings.
The Joyce Foundation supports Policy Matters Ohio research on workers in Ohio. The St. Ann Foundation provides additional funding for presentations and popular education on these issues. We are also grateful to the Gund, Nord Family and Cleveland Foundations for other support.